In an indication that the growth in oil and gas activities is not an absolute guarantee of profitability, Quality Lease & Rental Holdings, an oilfield equipment supplier, filed for bankruptcy protection, citing falling service prices and increased costs of logistics. In documents filed in U.S. Bankruptcy Court in Victoria, Texas, where the company is headquartered, Quality, which operates as Rocaceia Energy Services, listed assets of about $50 million and debts of around $100 million.
The company provides drill-site services and equipment rentals to the oil and natural gas industry, including rig housing, water and sewer systems and well-site construction.
According to Bloomberg.com, the bankruptcy comes at a time when tight supplies for key oilfield ingredients, including sand for propping open cracks in oil-bearing rock, are slowing down work in key basins in the United States and Canada. Logistical challenges are adding costs for a service industry that has seen two years of falling prices for hydraulic fracturing work, Bloomberg.com noted.
