One of the largest oil and gas service companies just announced an incredibly savvy move last week… and I have a feeling the impact of its decision will reverberate throughout North America.
Now, I can probably count on one hand how many people ever believed that an oil and gas company would disclose all of the chemicals it uses in hydraulic fracturing.
You see, even though most companies disclose some of the chemicals, virtually all of them leave a few out under the stipulation that they are considered trade secrets.
Well, not anymore.
Baker Hughes recently announced that it can disclose 100% of the chemical ingredients in its frac fluid without jeopardizing their competitiveness.
Personally, I believe this will spark a new stage in the North American energy boom.
First, the disclosure will take some ammunition from environmentalists who remain skeptical of hydraulic fracturing.
Second, Baker Hughes will beat regulators to the punch. Their transparency will be viewed as an attempt to work with groups like the EPA and Department of Energy rather than fight them. In this way, the whole industry looks more receptive to regulators and less like an enemy.
And last, but perhaps most important: they are confirming the staying power of hydraulic fracturing and horizontal drilling as a necessary technology that’s vital to tight oil and gas production inside the United States.
Although this news will alleviate some of the concerns, the bigger question is whether other companies will follow suit. Haliburton (NYSE: HAL) is still on the fence as to whether they will disclose their chemical list or not.
Having that said, however, I think it’s only a matter of time now before the floodgates are opened and the rest of the industry follows suit.