Calfrac has a sophisticated supply chain management system that provides reliable and timely access to the key commodities, materials and equipment used to deliver the Company’s pressure-pumping services. The key supply categories are:
- Chemistries, including commodities such as nitrogen, carbon dioxide, amines, alcohol, acids and cementing materials;
- Fuel and lubricants;
- Heavy-equipment/vehicle procurement and maintenance; and
- Field equipment and materials
Our expertise in procurement and supply chain management creates value for our customers because it strengthens our ability to provide services in a reliable, efficient, timely, safe and competitive manner. Calfrac has developed a network of contracts and relationships covering each of these supply areas and serving each of our worldwide operating regions. Supply of critical materials and services is typically anchored in long-term arrangements that guarantee availability and delivery.
Supply chain conditions vary from country to country. Calfrac has experts in every region in which it operates, supported by head office. Internally we utilize recognized enterprise resource planning software packages from leading suppliers, enabling integration of our worldwide operations
Alongside the increased sophistication and competitiveness of the completions business, our management of the supply chain has moved beyond the traditional “tactical” or transaction-based method and towards a partnership-based approach aimed at building a total value proposition serving our customers’ needs. We believe the effectiveness of partnerships is critical to the effectiveness of the overall business. Calfrac has an organization and a culture of partnering, which creates an advantage for Calfrac and its customers, particularly in today’s volatile economy.
Our focus on continuous improvement includes strengthening our supply chain through new supplier partnerships. We seek companies that can align themselves with Calfrac based on our customer-centric philosophy, our primary focus on unconventional completions and our desire to create value for our customers. The partnership relationship can be local, regional, national or global.
We take a total cost approach that goes far beyond pricing the commodity and takes into consideration the total cost or ownership, in order to create a value proposition for Calfrac and the partner. This in turn helps us develop our value proposition for our customers, which includes key performance indicators to help manage the outcomes.