So in these cases, we’re much more likely to be more concentrated with the buyers than the sellers in those deals. So yes, it’s been a small headwind for the industry and maybe a very small tailwind for Liberty.
Keith MacKey: Okay. Thank for that. Just maybe a little bit on Australia. You talked a little bit about the entry into the Beetaloo Basin. Can you just talk about where you are in that? I think some of the equipment was maybe getting ready to get transported. So just an update there would be helpful. And do you see this as really a one-off opportunity or are there other potential international opportunities that you might be looking at as well?
Chris Wright: Look, we’ve been pitched about international opportunities almost as long as we’ve been a company. So the interest in having Liberty’s engineering prowess in addition to horsepower and equipment and all that, the interest in that international market has been strong. Our view in the past has always been we’re super loyal, and we move slowly. So we’re in a basin like we’re going to stick with our partners in that basin. We tend to have very sticky customers. We’ve slowly moved to other basins as we build more capacity or existing customers have pulled us there. So we’ve been more gradual in doing those things. But the [indiscernible] sort of checks two boxes. One is the gas in place is enormous. It’s this tremendous gas basin that hasn’t produced any gas yet, but could and should and when we talk about — and you can read about it in Bettering Human Lives, the fastest-growing energy source on the planet over the last 12 years, by far, is natural gas.
That likely continues in the coming decades as well. So Beetaloo is a huge resource base — Australia itself is having struggles with domestic gas prices and gas supply and the projections there show things getting tighter. So there’s a need for that gas there in Australia, you’re right near the South Asia and Southeast Asian markets for it. So it’s a big upside. And with the rollout of digiTechnologies, we’ve now — we’re bringing in new fleets, and we don’t need new capacity. So we’ve got fleets going out the other side that we can retire or in the case of Beetaloo where we could send a fleet to Australia. And we’ve got good partners there, and I think we’re levered pretty nicely to upside in that basin. But it’s small. That’s a multiyear thing for that to become meaningful, but could it become meaningful?
I think we think it could. I’ll let Ron update you a little bit more about like what’s going on timing-wise and how that’s going. But it’s an exciting new opportunity for us.
Ron Gusek: Yes, just a quick update there, Keith. So we isolated a fleet of equipment, identified the assets that we’re going to head over there. They’ve gone to a central facility for us. They are basically done their refurbishment program at this point in time, making sure that, that fleet is ready to operate in a relatively remote environment. So as we wrap that up, that fleet will ultimately move down to the Gulf Coast, and we’ll have that loaded on a boat sometime here in the middle to latter part of Q2, and it will find its way to Australia — should arrive there in early maybe mid-Q3. And then we’ll have to work our way through customs and whatnot there before we have that on the ground and ready to work, but that’s where we stand today.
Keith MacKey: Okay. Thank you very much.
Chris Wright: Thanks.
Operator: Our next question comes from Waqar Syed with ATB Capital Markets. Please go ahead.
Waqar Syed: Hi. So we saw the data from EIA and North Dakota Oil and Gas Commission. It shows that completion activity in North Dakota Bakken was down about 24% quarter-over-quarter in Q1. And also in Wyoming, Colorado area, it was also down about 22%. Did you experience declines in work in those areas? And how do you see that kind of changing in Q2 and going forward?
Chris Wright: Yes, absolutely the case. The Bakken historically has a very meaningful winter downturn and absolutely did this year as well, as you just pointed out in that data. So absolutely, the reduced activity in the Bakken in Q1 and also some reduced activity in Wyoming and Colorado. So yes, that data is true. I think we’ll see — yeah and that activity will rebound a little bit for the quarters for the rest of the year.
Waqar Syed: No. So that’s a pretty big change in activity. How would the incrementals behave as a result? Wouldn’t that be a pretty strong tailwind to incremental margins as that happened in Q2?
Chris Wright: Well, the other thing is all of our assets are on wheels. So when activity declines in Bakken there’s just less fleets working, we drive those fleets elsewhere.
Waqar Syed: Yes. That’s it. Thank you very much. That’s all I had.
Chris Wright: Yes. Thanks Waqar.
Operator: Our next question comes from Saurabh Pant with BoA. Please go ahead.
Saurabh Pant: Hi. Good morning, Chris, Ron and Mike. Maybe I want to start on the efficiency side of things. Like you noted in your press release, in your comments over the past 12 months, efficiencies have been really strong, right? And the obvious question is how much running room do we have, right? But as a follow-through on that, how much of the incremental efficiencies do you think come from pumping companies like yourself? And how much of that do you think is in the hands of the E&Ps, the operators in terms of maybe logistics or just the way they design the jobs and line up the supply chain? If you can just talk to that a little bit.
Chris Wright: Yes. It very much requires both sides. You’re on location. It’s a dance between wireline and frac and your customer and logistics and supply chain and operations. It’s also I would say one of the advantages Liberty has had. If you deliver the best quality, you get — you can work with the best customers. So it is absolutely a coordination of all of those. And I’ll turn it over to Ron, who’s certainly been a leader in the engineering, innovation, the way to think about this and to find the opportunities to move progress.
Ron Gusek: Yes. Obviously, we continue to work on that. You saw we made progress — incremental progress each and every quarter, one after the other. And so that’s a credit to the operations team to our technical development team as we continue to find ways to understand more and more about how our equipment is operating to be proactive around things that could move the needle could put us — could help us deal with some downtime. We’re finding ways to identify those and react to them before they happen. And so that’s a credit to the whole operations team out there. There’s still opportunity there. We continue to find ways to move the needle on that. But the low-hanging fruit has gone a long time ago. These are going to be modest incremental improvements as we continue to take equipment to the next level, even as you think about digi, our next-generation technology, the time between overhauls on these gas engines look meaningfully different than it does on a diesel engine.
As we automate the operation of the pumps, we can ensure increased longevity of components out there. So less time required for maintenance as we have worked closely with partners around things like hot swap technology, the ability to get a pump in and out of the red zone without having anybody step into place there around zero time between moving from wireline to pumping on a wellhead, strong partnerships as Chris mentioned over the E&P side of things, but also with other service providers out there that are bringing supportive technology to the table. And then also for us, of course, speaks to the vertical integration we continue to work on as we work on improving our logistics platform, the introduction of LPI and removing that reliance on third-party for natural gas, all of those sorts of things from an integrated services offering help us to ensure the highest possible efficiencies on location, and we’ll continue to try to find little ways to [indiscernible] a bit more in that quarter-after-quarter.
Saurabh Pant: Right. Right. No, that’s very helpful. And then just one unrelated one. I’m just thinking about the medium-term, not just the very short-term, but I think as I remember correctly, Chris, Ron, you talked about 90% of your fleet being gas-fired by the end of the year. And some of your competitors have talked about similar numbers, not exactly 90%, right, but a large majority of the fleet being gas-fired. How should we think about that if we think a couple of years out from now and a lot of the working fleet at least maybe not the total inventory, but the working fleet is gas-fired? At what point do we think about more gas-on-gas competition versus just displacing diesel like we are at this point?
Chris Wright: Absolutely. But we talk about fleet technology a lot. That’s a positive development for the industry. It lowers cost and all that. But it’s not determinative. A fleet is in a good fleet or a bad fleet based on what it burns, that’s just one factor. The single biggest factor by far and away is that humans running that fleet, the quality of operations, the quality of the supply chain. We don’t talk too much about this, but we’ve had certainly multiple examples where a Liberty diesel fleet is displacing a 100% gas burning fleet. And it’s just for quality of operations and people. Customers just — it’s not just the fuel it takes. That’s just one factor. It’s mostly about humans and service quality. And so yeah, that is a spec but not the spec.
Ron Gusek: And I would maybe go a step further than that and say it’s also important to remember that not all gas fleets are created equally. There are significant technology differences between the opportunities out there to consume gas. We have been very, very specific about the technologies we have chosen to invest in and deploy in the field, both in digiPrime and digiFrac around ensuring that the gas burning technology we deliver in the field is the highest efficiency, lowest fuel consumption and as a result, lowest emissions footprint on location. That’s not true for all gas burning technologies.
Saurabh Pant: No, I think that makes sense. Execution often tends to be the unsung hero. And then, Ron, I think you talked about that on the LAT side as well, right, so it makes sense. Okay. Thanks. I’ll turn it back. Thank you.
Chris Wright: Thanks, Saurabh.
Operator: Our next question comes from John Daniel with Daniels Energy Partners. Please go ahead.
John Daniel: Hi, guys. Thanks for including me. Just, Chris, given the demands for power over the next basically decade, how far out are you guys having to place orders for content on your equipment and for LPI?
Chris Wright: Supply chains are tricky. Supply chains are tricky. There’s a lot of dialogue going on about that. I probably — I won’t comment on any specifics there, John, but you do identify a real issue. It’s — there is not a surplus of such equipment.
John Daniel: Okay. Do you — and I don’t know if you can answer this, but I’ll ask it anyway. Is there any risk that the major OEMs pivot and allocate more product to data centers directly to the detriment of oil and gas?
