British firm acquires Texas valve maker for fracking industry

The British industrial engineering firm Weir is to acquire Texas-based Novatech for $176 million. Novatech manufactures valves and valve seats for high-pressure applications such as workover pumps, high-pressure well service fracturing pumps, cement and mud pumps used in unconventional upstream oil and gas operations.

Weir already holds a dominant share in the supply of high-pressures pumps used in the extraction of North American shale gas. It has a six-month backlog of valve orders from rig operators where wells have been drilled but not fracked. The acquisition of Novatech, which doubles Weir’s share of the global market in surface fracking equipment, will allow Weir to expand its manufacturing capability in Texas and Alberta.  

"This deal enables Weir to broaden our aftermarket expendable product portfolio in this fast-growing sector, where increasing operating intensities require equipment and components to be more regularly replaced and serviced," said Keith Cochrane, CEO of Weir.

The rapid expansion of demand for equipment, which is subject to extremes of pressure and abrasion, has created a lucrative aftermarket for spares, which Weir can exploit, according to Cochrane.

President Obama indicated in his State of the Union address last night that his administration places high value on the natural gas industry, environmental concerns about the practice of fracking notwithstanding. “We have a supply of natural gas that can last America nearly 100 years, and my administration will take every possible action to safely develop this energy,” he said.