US launches antitrust investigation into pressure-pumping industry
By ALISON SIDER
The US Department of Justice has started an antitrust investigation of the pressure-pumping business, a key component of the oil-and-gas industry practice of hydraulic fracturing, Baker Hughes said in a filing with the Securities and Exchange Commission.
Baker Hughes said it received a Civil Investigative Demand from the Justice Department under the Antitrust Civil Process Act. The request sought information relating to the US pressure-pumping market beginning May 29, 2011.
Pressure pumping, the process of injecting water and other materials into a well to break apart rock formations and unlock oil and gas, is the main step in the hydraulic-fracturing process. That technique helped spur a boom in U.S oil and natural-gas production.
Three companies still dominate the pressure-pumping market in North America: Halliburton, the top provider of such services in the US, Schlumberger and Baker Hughes. Although their market share has declined in recent years, the three companies accounted for some 63% of the North American pressure-pumping market in 2012, according to Barclays.
Baker Hughes didn't provide additional details about the scope of the investigation or the information requested.
"We are not able to predict what action, if any, might be taken in the future by the DOJ or other governmental authorities as a result of the investigation," Baker Hughes said in the filing.
Spokesmen for Halliburton and Schlumberger couldn't be reached immediately for comment.
Dow Jones Newswires
Comments