ProPetro’s PROPWR Division Secures Landmark 10-Year, 80MW Power Capacity Agreement: Pioneering the Future of Distributed Energy in the Permian Basin
ProPetro Holding Corp. (NYSE: PUMP), a leading provider of completions services to upstream oil and gas companies across the Permian Basin, has announced a major strategic milestone for its newly launched power solutions division, PROPWR℠. The Company has officially entered into a long-term power capacity agreement that will see PROPWR provide 80 megawatts (MW) of power under a 10-year contract—its first major deal since launching the business.
This agreement represents a major step forward in ProPetro’s mission to “Rethink The Grid” and redefine how energy is generated and delivered to meet the growing demands of oil and gas operations in remote regions. In collaboration with a prominent exploration and production (E&P) operator that is focused on the Permian Basin, this agreement sets a strong precedent for future projects and validates PROPWR’s core business model of delivering distributed power solutions using stranded and in-field natural gas.
Strategic Importance of the Agreement
Under this pioneering deal, PROPWR is committing to install, operate, and maintain power generation assets that will supply energy to a distributed microgrid system—a modular and scalable approach to power delivery that is especially valuable in oilfield regions lacking reliable utility connections. The initial asset deployments will commence in the third quarter of 2025, with full capacity deployment continuing into 2026.
This project marks PROPWR’s transformation from a concept into a revenue-generating segment of ProPetro’s business. By signing a contract with take-or-pay obligations, the agreement provides revenue stability while also securing guaranteed capacity utilization. This model ensures PROPWR’s investments will yield predictable returns, a compelling value proposition for investors and stakeholders in an otherwise volatile sector.
Importantly, the project is engineered to utilize in-field natural gas, converting a traditionally flared or underutilized resource into productive and low-cost energy. PROPWR will deploy a hybrid power generation system composed of natural gas reciprocating engines and gas turbines to ensure high availability and operational flexibility. These proven technologies will enable consistent power delivery, tailored to meet the operational timelines and production needs of the customer.
A Full-Scope, Turnkey Power Solution
What sets PROPWR apart from traditional power providers is its full-service approach to power infrastructure. Under this agreement, PROPWR is responsible not only for asset provision but also for onsite operations, real-time monitoring, ongoing maintenance, and performance guarantees. This comprehensive solution reduces the burden on the E&P operator and offers a plug-and-play model for upstream oilfield power needs.
The inclusion of availability guarantees in the contract is particularly significant. It reflects PROPWR’s commitment to delivering reliable, high-uptime power in a sector where operational downtime is financially costly. The use of distributed microgrids makes the system highly resilient to grid outages, providing energy independence and reducing reliance on overstressed or inaccessible utility infrastructure.
In addition to this secured 80MW commitment, the contract contains scalable expansion provisions, giving the customer the option to increase their power capacity needs with PROPWR over time. This flexibility not only speaks to the scalability of PROPWR’s solution but also provides a pathway for long-term revenue growth and network expansion.
CEO Commentary: A Strategic Inflection Point
ProPetro CEO Sam Sledge shared his vision for PROPWR during the announcement, highlighting the strategic significance of this first contract and outlining the broader implications for both the company and the oilfield services industry.
“This milestone is just the beginning for PROPWR,” said Sledge. “We believe it’s a meaningful step forward, not only in expanding our capabilities, but in shaping the future of distributed power in our space.”
Sledge emphasized that this contract demonstrates PROPWR’s ability to provide lower-cost, lower-emission, and highly reliable power at a time when both energy security and environmental performance are front-of-mind for oilfield operators.
“Even in today’s uncertain oil and gas environment, PROPWR puts us in a strong position to serve our customers with more reliable, lower-cost, lower-emission power that creates real value for them, and real opportunity for us.”
“PROPWR, and agreements like these, also add another layer of stability and earnings potential to our core business,” he continued, “further industrializing both ProPetro and the broader oilfield services sector.”
Launched in late 2024, PROPWR was created in response to the growing need for resilient, scalable power solutions in the Permian Basin and similar operating environments. Since its inception, market interest has far exceeded initial projections. The success of this first deal affirms ProPetro’s strategic bet on the convergence of energy infrastructure and oilfield innovation.
More Deals on the Horizon
According to ProPetro, this is just the first of several anticipated contracts for PROPWR. During its first-quarter 2025 earnings call, the Company disclosed that it has already agreed to terms with a second customer via a letter of intent (LOI). Negotiations are currently underway to finalize that contract.
Given the robust demand for distributed power in the Permian—and the increasing constraints faced by traditional utilities—PROPWR is well-positioned to capitalize on a fast-growing market opportunity. Oilfield operators are under pressure to reduce flaring, lower emissions, and stabilize their operational costs. PROPWR offers a solution that directly addresses all three challenges by turning in-field gas into usable power while ensuring a high degree of uptime and cost efficiency.
“Our focus is strong, and we believe the future is bright for PROPWR,” said Sledge. “Since launching the business late last year, demand has been greater than we expected. We believe this market, and PROPWR, is just getting started.”
Industry Implications: Transforming Oilfield Power
The broader implications of this announcement are significant. As the energy sector continues its complex transformation, oilfield service providers like ProPetro are increasingly being called upon to deliver innovative, integrated solutions that span traditional service lines. PROPWR exemplifies this shift, bringing power generation and infrastructure directly into the core of upstream operations.
Distributed microgrids represent a paradigm shift in how energy is delivered to remote operations. By moving away from centralized utility dependence, operators gain autonomy, lower costs, and more control over their emissions footprint. Additionally, the ability to monetize stranded gas assets further enhances economic efficiency while supporting ESG (Environmental, Social, and Governance) goals.
For investors, this move signals a shift in ProPetro’s strategy toward more stable, long-term revenue streams. Whereas traditional oilfield services are often subject to boom-and-bust cycles, energy infrastructure—especially underpinned by long-term contracts—offers more predictable cash flow and greater business resilience.
