ProPetro Holding Corp. (PUMP) just landed a sizable power contract in the Permian Basin, and it's the kind of deal that shows how quickly the oilfield services world is evolving. The company's PROPWR business—basically their power solutions arm—will be providing turnkey power systems and distributed microgrids for a Coterra Energy Inc. (CTRA) subsidiary, with field operations kicking off in early 2026.
Here's why this matters: on-site energy solutions are becoming increasingly important across the oil-rich stretches of West Texas and New Mexico. Rather than relying on traditional grid power (which can be unreliable in remote drilling areas), operators are turning to custom microgrid setups that can deliver steady, scalable power exactly where it's needed.
The Coterra deal pushes PROPWR's total contracted power above 220 megawatts, with contracts averaging around five years in length. That's the kind of long-term revenue visibility that gets investors excited—especially in the volatile energy sector. According to executives, the agreement demonstrates PROPWR's ability to execute projects quickly while locking in stable cash flows.
The microgrids will be installed in the New Mexico portion of the Permian Basin, one of the most productive oil regions in North America. PROPWR President Travis Simmering highlighted that the partnership reflects surging demand for flexible, scalable power solutions tailored to oilfield operations.
To keep up with this growth, PROPWR has ordered another 190 megawatts of generation equipment, bringing total capacity—either delivered or on order—to roughly 550 megawatts. That includes natural gas engines and modular turbines, with deliveries scheduled through 2027.
The expansion comes with a price tag. ProPetro raised its 2026 capital expenditure forecast to $250-$275 million, above previous guidance. Management plans to fund most of this through free cash flow generated by the company's core completions business, though they're keeping the door open for external financing if needed.
CEO Sam Sledge noted that PROPWR has made impressive progress since launching just a year ago, securing contracts, deploying assets, and building out supply chain partnerships. He added that ProPetro's broader operations remain strong, with hydraulic fracturing fleet activity expected to hold steady heading into 2026.
PUMP Price Action: ProPetro Holding shares were down 2.60% at $10.85 at the time of publication on Friday.
