Flotek Industries released an independent report Tuesday showing that its proprietary blend of completion fluids helped boost production in wells in Colorado, refuting earlier criticism that it manipulated data to make its products appear more effective than they were.
The Houston-based oil field services company launched an investigation of its chemicals and data analysis software after an Australian fund manager in November disputed the accuracy of Flotek’s self-reported results.
Bronte Capital alleged that Flotek’s FracMax app, a sales tool used by the company to demonstrate how its chemical increase output in customers’ wells, inaccurately reported production from a handful of wells, making it difficult to gauge the product’s effectiveness and raising questions about whether the company intentionally misconstrued the output numbers to make the chemicals look better than they were.
On Tuesday, Flotek released the first in a series of independent reports by MHA Petroleum Consultants examining well production data in three different shale plays to determine how Flotek’s chemiclas affected output.
The first report, focused the DJ Basin in Colorado, found that wells that received Flotek’s patented complex nano-fluid technology, or CnF, performed better than wells that didn’t receive the product, which is derived from citrus fruit and designed to help pry loose more oil and gas trapped underground.
Using data gathered on 1,133 wells in three different areas in the Niobrara formation, MHA Petroleum Consultants determined that wells treated with CnF saw productivity gains of 9.8 to 46.9 percent in a year.
Overall, the report concluded that two focus areas showed a significant increase in historical production and ultimate oil output, but the results for a third, more gas-rich focus area weren’t as conclusive. The consulting firm is performing a similar analysis on wells in two Texas shale plays, the Eagle Ford and the Permian Basin.
Read the report: Consultant examines well performance in Colorado
Flotek said those reports will be released once they are complete. The company also plans to schedule a conference to provide a “comprehensive review of the methodology and findings to interested parties.”
Flotek has argued that its the errors in its original data were the result of an “unintentional data and processing error” due to its use of third-party data that led the company to overstate the performance a well. Still, the company has maintained that wells treated with CnF have better output than those that don’t receive the additive.
Shares of Flotek’s stock popped up 44 cents, or more than 7 percent, to $6.25 following the release of the report Monday. Still, the company has been unable to regain ground lost following the November criticism, when shares of stock tumbled by almost 40 percent in a single day.