Liberty Energy Inc. (NYSE:LBRT) Q4 2022 Earnings Call Transcript

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So most of what’s going to happen, I suspect in the industry- for those that are investing for the next thing is going to be taking those Tier 2 engines and making a Tier 4 engines. The bigger players have electric options for us, it’s – we’re trying to develop, and I believe we have developed technologies that for us will be both cheaper and better. And that’s why we spent years doing it. The history of electric frac fleet has actually been more expensive and worse. Now there’s, more fleets that are maybe a little better, but they’re more expensive. We’re trying to solve for both of those cheaper and better with our next-generation technologies, a lot of investment in getting here, but we like what we said.

Tom Curran: Understood. Let me give Ron some more airtime, two-part question for you, Ron. First, for the three digiFrac spread you expect to have deployed by 2Q? Which should we expect those to be powered by – will they be on the Rolls Royce MTU gas gen-sets? And then maybe I’ll push for a bit more of a sneak preview on your upcoming event. But under operation 1440, could you give us updates on two technology initiatives, preemptive maintenance and then automation?

Ron Gusek: Yes, so to your first question, absolutely, you’re 100% right. Those fleets are all going to be powered by the 20V 4000, the Rolls-Royce natural gas recip engine. We’ve – we like that power plant. It’s the most efficient power plant in the space. And so it will be paired with every one of the digiFrac pumps that we put out in the field for Fleet 1, 2 and 3. And then that same power plant, just a slightly smaller version, the 16 cylinder going on digiprime. And then as you – you think about the other piece of that puzzle, we made tremendous strides last year in both of those areas. As you think about the preventative maintenance side of things, we launched the team in January last year with a strong focus on moving forward in that preventative maintenance side of the world.

I would say we made huge strides, and we saw that in our cost of maintenance last year, our ability to – run our equipment at, well – really flat maintenance costs in the face of very, very strong inflationary pressure. So that’s a credit to that team and the work they’ve done from a predictive maintenance standpoint. The amount of intelligence we have or insight we have on our equipment today, probably orders of magnitude beyond where we had been in maybe three or four years ago so huge stride there. Artificial intelligence, of course, we’re moving rapidly towards full deployment of our next-generation fleet operating software. Really a piece of software that effectively enabled us to tell the fleet what rate we want to achieve and the maximum pressure that we can pump at and the software is making all the decisions about how to run those pumps optimized for gas substitution or whatever we might ask of it.

But those decisions are all driven by a computer going forward.

Tom Curran: Great, I appreciate all the detail. Thanks guys.

Operator: The next question is from Saurabh Pant with Bank of America. Please go ahead.

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