FTS International, Sinopec Form China JV

FTS International (FTSI), one of the largest well completion service companies in North America, has entered into a 15-year joint venture agreement with the Sinopec Group in an effort to bring its hydraulic stimulation capabilities and expertise to China.

Upon incorporation in China, the joint venture company, SinoFTS Petroleum Services Ltd. (SinoFTS), will be owned 55% by Sinopec and 45% by FTSI, the Texas based company said in a statement Tuesday.

SinoFTS is the first oilfield services collaboration of its kind between a non-Chinese well completion company and a Chinese national oil company. SinoFTS will serve both Sinopec and other exploration and production companies throughout China.

“As Sinopec leads the development of China’s unconventional oil and gas resources, estimated as the world’s largest, this joint venture will create a China-centric well completion company with industry-leading capabilities. The joint venture marks a major milestone in the development of China’s shale resources, the collaboration between Chinese and U.S. companies, and FTSI’s international expansion plans,” FTSI said.

The collaborative endeavor will initially focus on the Sichuan basin, China’s most promising shale play, providing services under a long-term, dedicated contract.

Operations for the initial fleet are expected to commence in 2015, and further deployments of pressure pumping fleets are expected in basins throughout China.

“China has vast untapped shale gas resources, and we’re eager to play a role in their development. Just as FTSI was born out of the emergence of the U.S. unconventional energy industry, we expect that SinoFTS will enhance the development of China’s domestic energy renaissance. Sinopec will be a key strategic partner for us, and we see a long, successful venture ahead, working together in a country poised to develop as the world’s largest unconventional oil and gas producer,” FTSI Chief Executive Officer Greg Lanham commented.