
The partnership that Comtech Industries has with our sister company, DeepRock Disposal, has created an additional layer of diversification allowing us to drive value for our clients in the basin.
Industry M&A activity is not limited to production and midstream companies, as observed in the recent announcement from DeepRock Disposal Solutions, LLC., and Fountain Quail Energy Services, LLC. The companies recently announced the closing of a merger of the saltwater disposal (SWD) assets of FQ with DeepRock’s Marietta-based saltwater disposal facility. The combined company, which will operate under the DeepRock name, immediately becomes one of the largest SWD operators in the Appalachian Basin. The combined 12 wells, at five Class II UIC facilities located in Ritchie County, WV, Dexter City, OH, Marietta, OH, Portland, OH, and Reno, OH, provide a total capacity of 50,000 BBLS of water per day, with several permits in hand for future capacity expansions.
A heavily regulated, but often a less thought about side of the industry, SWD’s tend to quietly operate in the background of our industry. This merger also combined two well positioned companies with a unique common opportunity. Premier offload sites for produced water via barge in the Appalachian Basin enables a single touchpoint for all customers anxiously awaiting the cost-saving solution of disposal via barge. The management of DeepRock anticipates beginning to offload barges Q1 of 2021 at one of their facilities, and will have the second ready for offtake by mid-2021, creating redundancy and scale.

“The merger of these two entities creates the kind of scale and competitive advantages which will benefit not only our combined companies, but also our entire complimentary customer base,” said Dean Grose of DeepRock Disposal. “Our combined disposal capacity and permits in and around the Basin will allow us to provide even more flexibility to our current customers in the area while the option for barging will open us up to a whole new base of customers who have been seeking alternative methods of produced water transport due to their distance from viable disposal facilities.”

“With our planned build-out of barge offload facilities in both Marietta and Portland, OH, we will be able to reach an entirely new base of customers or new base of assets at an incredible scale, with offload capacity in Marietta and Portland combined already over 30,000 BBLS / day,” said Kirk Trosclair of Fountain Quail Energy Services. “This type of scale and ability to move water via barge will be a cornerstone of our company’s future success and will help drastically lower the all-in cost of water disposal for operators across the Basin. Additionally, our barging of produced brine will create safer roadways in our community by eliminating the need for dozens of long-haul trucks every day and further reductions as we move to pipe water into our on-loading terminals.”
Brian Chavez provided additional comments regarding community relations. “It was very important to me to maintain the social license to operate saltwater disposal on this scale. I live and raise my family in this area, I breathe the same air and drink the same water as everyone else. The size and scope of this combined entity in no way diminishes the local sensitivities to being responsible community operators and partners.”
The combined entity management team brings experience in SWD operations, natural gas and oil production operations, and total water treatment solutions. Brian Chavez will serve as CEO of the combined company while, Kirk Trosclair will serve as Chief Business Development Officer and Dean Grose as Chief Strategy Officer.
- As seen in Marcellus Drilling News: October 27, 2020. https://marcellusdrilling.com/2020/10/deeprock-fountain-quail-merge-form-major-m-u-injection-well-co/
- As seen in American Oil & Gas Reporter: November 2020 issue. p 78. https://www.nxtbook.com/nxtbooks/aogr/202011/index.php#/p/Intro
- As seen in The Pittsburgh Business Times- Energy Section: November 30, 2020. https://www.bizjournals.com/pittsburgh/news/2020/11/30/energy-companies-merger-brings-water-management.html