David Grzebinski: It is broader. And I would say accelerating, it may be too strong of a word, but improving. I wouldn’t say, accelerating because that makes it sound like it’s a huge ramp, but it is improving. The interest is improving. I mean, John, you know this better than anybody, the efficiencies you get with eFrac are so pronounced and so good for not only our customers, the pressure pumpers, but the E&P companies and the savings is there. And obviously, everybody likes the ESG benefits, but the operational savings is so significant. And I think and you should tell us because you know the customers as well as we do. But I think you’re just going to see continued building of eFrac and conventional Frac, you won’t see much of going forward in terms of new builds.
John Daniel: No, I tend to agree. There’s a lot of stuff that needs to be replaced out there.
David Grzebinski: Well, the only other thing I would say on you say accelerating, but we’re seeing some interest internationally now too, on Frac — on eFrac. So I would say, that’s kind of new to the game.
John Daniel: Would you be willing to share which markets are the most interested? I understand you don’t want to.
David Grzebinski: Well, I think you — it’s the Middle East.
John Daniel: Yes. Okay. Fair enough. On the supply chain constraints, the electronic components, do you have any more color you could add us, like what’s really driving that? Are they diverting supply to other sectors? Or they just can’t make it fast enough? .
David Grzebinski: Yes, it’s the latter. They can’t make it fast enough. We buy — I don’t want to name the vendor because that would not be nice, but we buy variable frequency drives, for example, from Scandinavian area, and they just can’t make it fast enough, which is an interesting dilemma. Sometimes you get enclosures that back up, and that’s — you would think that you don’t want to call it dumb iron, but you would think enclosures wouldn’t be a problem, but that gets backed up, different electric componentry and things around electrics seems to be backing up. And John, you know this, if you look at all the data centers going up and now you’ve got things like ChatGPT and AI. And just we’ve seen another surge for backup power, whether it’s in data centers or whatnot.
So we use that same equipment in generating electricity for the frac spreads. So it’s — there’s just a lot of demand in the system, and that’s what’s going. And it’s usually just electric or electronic related.
Operator: Our next question comes from Greg Wasikowski of Webber Research & Advisory.
Greg Wasikowski: David and Raj, I wanted to check in on that chunk of term contracts that rolls over in Q4. I know it’s early days here, but I wanted to see how would you characterize your initial expectations and your level of confidence when looking into Q4 right now, say, versus your expectations and level of confidence last year and the year before?
David Grzebinski: Yes. Well, last year, we didn’t — we were still recovering a little bit from COVID. So this year is much, much better environment than last year. Last year was good. Don’t get me wrong, but we were still, has COVID really gone, is the market really coming back, are the volumes on the river coming back? So — and we did see it come back. And of course, first quarter of this year, we had some pretty tough weather conditions and whatnot. So I would say, contract renewals feel better this year. I want to use the word significantly better, but they certainly feel better. It’s a tight market. This maintenance bubble is real. Our customers have lots of volumes to move. And you can look at the share buybacks among our customer base and it tells you how good they’re doing, right? So the barge cost to them in terms of moving refined products or chemicals is nothing and they should be generous.
