Why Nuverra Sees Big Things From Recycling Waterhttp://www.fool.com/investing/general/2013/09/25/1-potentially-massive-opportunity-for-nuverra-inve.aspx Matthew DiLallo
September 25, 2013
It has been a rough year for investors of Nuverra Environmental Solutions (NYSE: NES). The company has been hit by everything from bad weather to bad business decisions. However, its future could turn out to be a lot better than its recent past. That's because the company is sitting on what could be a potentially massive future opportunity to recycle the water used in hydraulic fracturing.
As details of Halliburton's (NYSE: HAL) partnership with Nuverra begin to emerge, it is becoming clear that the pair must first overcome a pretty tricky logistical problem. It's that problem that most investors, and even analysts, aren't even aware exists, which is why it could be one massive opportunity for Nuverra's future business.
For some color, consider the following dialogue during Nuverra's most recent quarterly conference call. An analyst asked management an intriguing question about the recycling process that largely summed thinking that the opportunity for Nuverra in the partnership might be limited. The analyst asked:
His concern is that increased recycling on-site thanks to Halliburton's H2O Forward service might hurt instead of help Nuverra's business. However, according to Nuverra CEO Mark Johnsrud, the opposite is true. Johnsrud noted that: