May 04, 2020 [MRT – Published on May 2, 2020] – Gravity Oilfield Services is making its storage tanks, normally used as frac or mud tanks, available to producers for crude storage.
Sinking oil storage capacity has roiled the markets in recent weeks, contributing to a plunge in oil prices.
Amid the search for additional capacity to store the flood of crude not being used by a world shut down by the COVID-19 pandemic, Gravity Oilfield Services is stepping in to help.
The Houston-based water and energy infrastructure company is offering its inventory of crude oil storage tanks to operators in the Permian Basin, Eagle Ford and Haynesville plays.
“We already own the tanks and as a result of the decline in their normal use for frac tanks, mud tanks, etc., we are making them available for crude oil storage to fill the immediate needs of our customers as other storage becomes unavailable,” Rob Rice, the company’s chief executive officer and president, told the Reporter-Telegram by email.
The company has already shipped out more than 1,000 tanks in the past couple of weeks and has another 4,000 more available for immediate shipment, Rice said. The company Gravity doesn’t plan to build more.
The tanks, Rice said, are generally used for temporary storage of liquids, but are being made available to customers for long-term use.
“Historically they have not been permanent, and we do not expect them to become permanent storage now. We do expect they could be used for at least 12 months,” Rice said.
He said the company is seeing high demand in the Permian, Oklahoma, South Texas and north Louisiana. “The highest demand to date has been in Oklahoma but we are seeing increasing demand in the Permian,” Rice said.
In a statement announcing the availability of the tanks, Mike Sledge, Gravity’s vice president, sales, said,
“We have successfully navigated distressed markets before, and we are committed to leveraging our best-in-class safety record and our fleet of tanks to help operators navigate this challenging market.”
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