Water Hauling Company Gets New Trucks Thanks to Oil and Gas Factoring
Industries: Transportation and Trucking; Oil & Gas Sector
Location: Edmonton, Alberta, Canada
How Much? $250,000
Edmonton AB Canada – Oil Field water hauler – 6 trucks. $250,000 Facility. They had cash flow issues making payroll and keeping the trucks fueled up while waiting for payments over 70 days.
As the oil and gas sector continues to boom thanks primarily to shale oil and gas exploration and drilling, a wide range of supporting businesses such as trucking and transportation are also experiencing their own fair share of growth. In addition to moving the fuel and gas liquid itself, transporting water and other fluids as has proved to be a growing enterprise for water haulers.
Today’s shale oil and gas boom comes from a process called hydraulic fracking where water or other liquid substance is pushed deep into the ground to loosen up and ultimately remove shale gas and oil trapped in rock. Pumping out this fresh and potable water and properly recycling or disposing of it is big business.
Transportation Factoring Is Helping to Provide Cash for Fast-Moving Industry
Located in Edmonton, Canada, one such water hauling company for the shale oil and gas sector found its demand for business increasing but was unable to keep pace with the rate of growth. Lack of transportation funding due to both fast growth and slow payment from customers – sometimes as much as 70-days — was making business operations unmanageable.
Worst of all the company was facing the situation every trucking company dreaded: immobile trucks due to lack of fuel. In essence the company would be losing money if its trucks continued to idle. Without any oil and gas funding soon, it was not going to be able to meet its own payroll let alone expand its fleet of trucks to keep pace with growth and remain competitive.
Oil and Gas Project Financing Provided the Solution Just in Time
The water hauling company reached out to a trusted invoice factoring company, Business Factors & Finance, for immediate cash. Not wanting to take the time to go to traditional banks for oil and gas loans, the company wanted to try oil and gas factoring. It secured a factoring receivables contract for $250,000, the amount it sought.
By selling their most current invoices for cash, the company was able to pay down its bills, ensure payroll obligations were met and keep business operations flowing. The freight factoring even enabled the company to purchase six new trucks. Financing oil and gas projects remains a challenge as water trucks, pump equipment, fuel costs and payroll do not come cheap. But the rapid growth of the industry makes transportation as well as oil and gas financing an attractive investment option.