We're going to go through these slides fairly quick, make sure we leave plenty of time for Q&A at the end, because I know there's probably a lot of questions of the market and then ProPetro in general. Our current thesis of ProPetro is pretty simple. We have strong free cash flow. Currently, going forward, we've invested over $1 billion since 2022 to refresh our current assets. We purchased some new technology, and we've diversified our offering just a little bit with other service lines that work well into our current portfolio. Right now, ProPetro's discounted valuation, multiple of which is relative to our peers, which is probably the reason why you're here, and it's a great time to invest in what we're doing. We're a pure-play Permian Basin service company. That's frac, cement, wireline, and our most recent organic startup of ProPower, which is power generation.
We have a superior field of E&P customers that have backed our work with contracts. Over 50% of our current fleets are out with long-term agreements, and our current organic startup of ProPower is going to be starting day one with long-term contracts. The most recent one was a 10-year agreement that was announced a couple of weeks ago. Right now, we are currently innovating to meet the growing demand of the transition of oil and gas to lower emission, more gas-burning equipment with our electric fleets and with the power generation company that we started. Our most recent earnings that we reported in Q1: $359 million in revenue, $73 million in EBITDA. The number I want to focus on is our free cash flow of $22 million bucks. That number is a strong number for one quarter.
If you take away the capital that we invested with our new organic startup with ProPower, that is over $50 million in free cash flow for one quarter. Right now, our current portfolio is built to these service lines: frac, wireline, and cementing. Hydraulic fracturing has been the monster that's kept the company growing for years to come. As we go forward, what you're going to see on this is ProPower is going to start gaining some percentages on hydraulic fracturing. I think a year from now, we could be closer to 20%-30%. Two years from now, I think two to three years from now, I think they're going to be even with hydraulic fracturing. That's how much upside and excitement the industry, our current investors, and the company has in ProPower. Strategy and execution is pretty simple. We optimize.
We've been industrializing our equipment and on location. We've been transitioning our fleet to more gas-burning equipment, which is newer technology. It's been more reliable, more efficient, working capital. Maintenance capital is less with this equipment that we've deployed in the last two years. ProPower, power generation opportunity that I've mentioned several times. Excited to get to those slides and talk more about that. Our strategic transactions that we've made through some M&A and with our current customer base contracts that we've structured, and our strong financial foundation. What we've been able to do is generate 12-15 months of very strong free cash flow in the company.
Yeah, I would just add to that last block down there, durable earnings and free cash flow. That's really what we mean by industrializing the business as well. The investments we've made in ProPower and then also our electric fleet are just going to accelerate that. Like, we haven't really seen that in the oil field service space. We're not the only ones doing this, but the oil field service space is so much healthier than previous cycles. Yeah, there are some near-term headwinds, but we're navigating them. You can see that we're navigating them quite well with our financial performance there in the first quarter and what consensus estimates show us here for the remainder of the year. Through ProPower and through our electric fleet offerings, we're going to be growing earnings in a slow-to-no-growth environment. I think that's really, really exciting.
ProPetro, we're headquartered in Midland, Texas, and we operate only in the Permian Basin today. We get asked a lot if we'd look in other basins. We'll absolutely look in other basins. Right now, when you have over 40% of the U.S. oil production in the Permian Basin, it's as much as we can handle today. We have conversations in the past and currently of other current customers asking if we'd want to go to another basin with them for a long-term agreement. Always entertain that. We look at M&A deals to get us in other basins. Right now, we have a very strong foundation and presence in the Permian Basin, and that's where our current 100% of revenue is coming from.
I'll take this slide real quick. This is just some financial numbers that we've been able to generate over the last few quarters. It's quite strong, especially in the first quarter, to see those types of numbers in an environment where rig counts have been declining. That's just indicative of our market presence and operational excellence. We've been able to grow market share in an environment where rig counts and frac counts have been declining. The fourth quarter, we did have some negative net income and net loss there, but that was really impairment-driven. When you strip out the impairment, it was strong earnings as well, both in 2024 and should continue to be in 2025 as well. On this one, we've mentioned M&A. This is just some of our recent M&A wins. Again, trying to industrialize our business. These are capital-light acquisitions.
Silvertip being the wireline one, Part Five, bolt-on cementing, and then Aqua Prop is really how do we industrialize our business by increasing our commercial and operational leverage. These were tools that have enabled us to do that and really have strong free cash flow generation. It is very accretive, and they have been big wins for the company.
Yeah, they complement that 75% of revenue of hydraulic fracturing very well. Silvertip and Aqua Prop were already on a lot of our locations before we acquired them. That was able to, from day one, to be a free cash flow machine for us and to start generating wins of us continuing to expand other customers. In Part Five, we did not have a presence in the New Mexico-Delaware Basin in cementing. We only had Permian-Midland Basin. It was hard for us to compete in logistics with everybody in the Delaware Basin, our competitors. We found Part Five, fantastic operation people, facilities, and it fit well to transition that into our company. Now we're very active and have a strong presence in the Delaware Basin and Midland Basins for cementing.
On this slide, we'd just like to highlight that we do have a share repurchase program. Our capital allocation philosophy is being very dynamic. We have since largely pivoted away from capital or the share repurchase into investing into our ProPower business because we believe that's the prudent strategy right now. We have bought back 111 million shares since the initiation of this program back in May of 2023. It's still open. We will remain opportunistic, but right now, most of our free cash flow is going into our ProPower business to try to grow that quickly. This slide is somewhat counterintuitive to show that we're the lowest value here, but we'd just like to point out that there is a lot of value at ProPetro, especially with what we've built and what's coming.
The whole space continues to be at a discounted valuation versus the intrinsic value of most of these companies, but ProPetro stands out within those companies. I think this one we've already hit on, but we are transforming to an industrialized model. You can see this slide is pretty cool to show where the OIH, Oil Service Index, versus the Industrial Sector Index, IXI, has traded over the last 10 years. There have been some massive dislocations, right? The reason for that is down there on the left. It's undisciplined capital. That's been the root cause of most of the dislocation and bankruptcies and unhealthy balance sheets.
We believe the reason for multiple re-rate is going to be for exactly what we're doing, investing in the right technology that's going to be capital-light and generate strong free cash flow and just really having both improved capital discipline, not only from ourselves and our peers, but also from our customers. We have seen that over the last five years. The stock has not represented that, but the companies are generating and proving out those investment theses today.
Through the last four or five years, we've talked about this, our transition of our equipment. The black bars, you're just straight diesel Tier 2 equipment that we had on location. As the industry started to use more gas-burning equipment, we started to purchase Tier 4 DGB dual fuel equipment. Within the past three years, then you start seeing the Force-selected equipment hit our portfolio, and we've continued to evaluate situations to expand that. Out of the red bar and the gray bars, like we said earlier, 50% of that equipment is under long-term agreements today.
One thing to point out is over the last three years, if you looked at this compared to a lot of our peers as well, the capacity is not really expanding, right? This is replacement. We are not wanting to expand capacity in this market. That is very key to enable returns to be thoughtful and reliable moving forward.
Our Tier 4 DGB performance is, I would say, best in class in the Permian Basin today. We started three years ago, and you can see how much we transitioned and grew in that development and efficiency where today that all seven of the fleets that are on location are substituting well above 65% around 70% every single day on location. There is a lot of incentives. There is a lot of upsides for EMPs to pick ProPetro as a partner going forward because then we can save them not only efficiency, more pumping hours per day, safe, but we are going to keep saving money because if they can utilize using their own gas instead of just burning it off or trying to figure out how to get it taken away, we are utilizing the fuel or equipment on location. All right, Force, we have mentioned this several times.
This is our electric equipment. Our first fleet was deployed September of 2023. We're coming on two years of that first contract. We have five fleets deployed of equipment today. Three of them are zipper operations. One's a simul operation, which equates to probably two zippers. So you've got five fleets of equipment contracted deployed today. We're seeing exactly what we expected with this equipment. The maintenance CapEx is low, efficiency is high, less people on location, and there's a lot of upside for operators to utilize 100% of their gas and save lots of money for them. We're evaluating other current opportunities and contracts right now to continue to expand this portfolio to contract and purchase more electric fleets going forward.
Yeah, I would just add with our Force Fleet and then two of our dual fuel fleets that we showed on the previous slide, over 50% of our active horsepower today is under long-term take-or-pay contracts. You are going to couple that with ProPower, which is garnering 10-year type contracts that are also take-or-pay in nature. This business is radically changing from previous cycles.
ProPower, our thesis here was to partner with ProPetro, start an organic startup under the ProPetro organization, really to, as you see here, align to the demand. In the Permian Basin alone, we're seeing about 4 gigawatts of load growth in the next five to seven years. Most of that is only related to oil and gas. If you start sprinkling in some of these new data center opportunities, the number gets quite a bit larger. As far as the overall growth in the U.S., you see numbers like 35 gigawatts for U.S. data centers in the next five to seven years as well. The demand side of this is just only continuing to grow. The supply side in terms of the type of equipment that can actually work in these is pretty tight.
What we thought was that, or what we believe is showing to be true, is that a lot of what we're doing on the power side is really complementary to what the electric transition has looked like for ProPetro. ProPetro has the personnel, the facilities, and really the background in this electric type of equipment, which is easily translatable over to the power side of the business. Although it may look like a kind of side business within ProPetro today, it's actually really well integrated with a lot of the service capabilities that we already have in ProPetro. Finally, clearly that business was to diversify outside of just completions. The first contract we announced is in a production application.
It's going to be with a similar customer that ProPetro would work with, however, a different part of their kind of value cycle in oil and gas. We're now expanding with current customers to be able to really have more market share and share of wallet with these big customers in the Permian. This is just a good slide to show kind of what these growth numbers look like in terms of the demand side. There are all sorts of numbers you can put on the board here. We had 28 GW addressable by 2038. That's growth within just the Permian Basin. That does include a lot of these data center opportunities that are starting to move into the Permian Basin because of the accessibility of gas, land, water, and all these types of things.
What we've done within ProPower to set ourselves up for success is we've already ordered 220 megawatts of equipment. We expect to deploy all of that by the middle of next year. We've actually already started taking delivery and doing early testing of equipment so that it'll be prepared to go out on this long-term contract that we signed a few weeks ago. Those are commercial rationale. I talked a little bit about this earlier. ProPetro, ProPower, clearly we want to stay in the Permian. We want to leverage the relationships that we already have in oil and gas.
We can leverage a lot of the field service equipment maintenance that I mentioned and really just take this electric frac example that has grown so significantly in the last two years and apply the same types of concepts to the power business to be able to grow that under the same maintenance program, safety, and really just leverage what we've already built out. If you see at the bottom there, these are really the different types of industries that we're looking at today or market segments. Primarily, production and midstream are the biggest opportunities in the Permian Basin from an oil and gas perspective. As you see production continue to come online, gas processing and gas midstream opportunities, they're all electrified nowadays, which means that they need a lot of power. There is not a lot of grid power in both the Permian and Delaware Basin.
I think this just kind of recaps exactly who we are. We're a customer-faced, team-driven company out of Midland, Texas, pure Permian Basin play currently, where we've been transitioned to a more efficient gas-burning capital-light equipment. The results are proven. We've shown it through quarter after quarter of what we've transitioned this company to be. That's one of them is being capital discipline and returning free cash flow to the company. We are reducing emissions through our transition of our electric equipment and driving to next-generation sustained solutions with ProPower. All management team on the team all live in Midland, Texas, offices there, and board of directors have a long history of oil and gas, executives with very well-known names and companies that they've been a part of, real proud of having them part of ProPetro.
I think, yeah, we're trying to get through that as quick as possible because we're hoping that you guys have some questions for the next 10-15 minutes. We'll open it up there for any Q&A. Yes, sir.
[audio distortion]
Yeah, so the contract that we've signed and announced is 80 megawatts over a 10-year contract. That'll deploy starting in the third quarter through the middle of next year. Obviously, we have 220 megawatts coming, so we have more power to place, but there's a lot of contract or a lot of negotiations happening right now that we'll look, I would say on the low end, three years would be probably the shortest we would even look at in terms of a contract. More so five to 10 years is what we're seeing just based on the fact that this market we're going after in West Texas and actually New Mexico, most of these customers don't have line of sight to power. What we're doing is setting up agreements that allow them to create long-term flexibility within their entire power field.
How do you price the power based on market rate?
We didn't really share how we were pricing the power in the contract, but they can compare it to their utility rate pretty easily and see that there's some upside for them on a 10-year contract.
If they can't get power from the utility, [audio distortion]
The utility will tell them they can get it in a certain amount of time, right? Maybe it is three years, five years. What we are doing is pricing these to where we are likely more competitive now than the utility would be. If you look at forward curves on the pricing from a utility, we are going to keep it relatively stable for them over a 10-year period.
We have publicly disclosed that these assets are paying themselves back in roughly four years. The 10-year contracts on assets that last 15 to 20 years, it's a very healthy return. Yes, sir.
What's the status of your efforts to sell power for data centers? [audio distortion]
Yeah, it is a different business. I'll start this and let Travis clean it up and finish it. That's the new sexy thing to say is AI and data centers for power. Everybody is focusing on that. That's great because there's a lot of demand and there's going to be a lot of demand there. When everybody's focusing on that, there's a lot of low-hanging fruit for ProPower in the oil and gas of a customer base that we already know and we have a well-established company to go and line all these contracts to set us a base for this company, this organic startup of ProPower, to get that strong base to start transitioning to these large data centers, utility, AI situations that is going to be there.
Yeah, I think that's well said. What we'd like to do is get our feet under us on these types of production microgrid applications so that we have the ability to transition into a data center opportunity if we want to down the road. There's tons of those out there right now. They definitely look different. I completely agree that what we're doing in the oil field, they're a lot larger, a lot of different types of loads on some of these AI. I think there's a lot to be figured out there from the technology side still, and we don't want to rush into that and stub our toes.
We're looking at data center opportunities that are probably not the ones that hit all the news articles, more in the 50-150 megawatt range is probably our sweet spot for a single installation on a data center opportunity. I don't see us playing in the 1 gigawatt range that you see some of these large announcements.
On the ProPower side, what kind of generation are you using? [audio distortion]
Good question. We do not have any exposure on the fuel. The customer provides the fuel. That is one of the benefits of being in oil and gas is they know the fuel side better than anybody does. That is a cost that they just handle themselves. As far as the equipment, these are larger engines and turbines. I think we have said publicly that we are using Caterpillar for nearly all of this equipment. We have a really strong relationship on the engine side as well as the turbines. Solar Turbines is their turbine manufacturer. We have had really good success with them so far. They have a great name in the market. They have been a good partner in helping us get stood up from a technology standpoint and are continuing to allow us to get capacity out into next year.
All right. Okay. What's to stop this from becoming more commoditized over time if you're getting a four-year payback? What does that look like in terms of [audio distortion]
I think that's a great question.
Yeah. I think that the challenge is there's only so much of this type of equipment that's out there, and there's not enough to meet the demand today. Most of the large OEMs are not going to oversupply the market because they've done that in the past. They've come out and publicly said, if you listen to GE or Siemens or Caterpillar, I don't think there's going to be enough equipment in the market to really commoditize what we're doing. I think in the smaller power ranges, so sub 5 megawatts, I think there's a lot of opportunity there to be commoditized on those opportunities. When you're providing north of 5 MW in an application that needs to be permitted, so it has to meet emissions requirements, it has to have significant uptime. It's a pretty hard business to get into. It's capital intense.
The people are a big part of it. We have spent a lot of time figuring out how to source the right individuals for this. We feel like we have a pretty good competitive advantage there. I guess on the IRR side, I do not know if you want to talk about that.
Yeah, we have not talked about that publicly, but we chase returns that are in excess of our cost of capital, and trying to create spread is basically the key fundamental theme that drives our returns there. I would just add to Travis's point, demand is going to keep growing in this power business, right? We showed that slide, and we are basically just a drop in the bucket of what is coming to the Permian Basin. There are going to be new entrants, and there is going to be some capacity that is brought online, but the growth is far outstripping that supply today. If you went to Solar Turbines or Caterpillar today and wanted to purchase 5-plus megawatt turbines, they are going to tell you 12-14 months. From today until 12-14 months is all ProPower in their supply chain. There is nobody in between.
That's for only the 220 megawatts that we've purchased and secured. Anything that we stack on top of that is going to extend that time of delivery even further. We've tied up their supply chain. We've kind of had ongoing conversations to be able to put in more orders if we wanted to, to drag that out even further. If anybody wanted to start a business, you're looking at 12-14 months before they've received their first asset.
That's been a huge competitive advantage for ProPetro, just given the fact that we spent a lot of money with Caterpillar over the last 10 years, right? We're a good vendor or client of theirs, and they've been a great vendor for us. Having that relationship that Travis had mentioned to be able to leverage our frac business, both from a customer standpoint, but also from an OEM vendor standpoint, has been huge.
Yes, sir.
Looking to the future, [audio distortion]
Yeah. I mean, I think that's one of our capital allocation. It will certainly be within the capital allocation matrix. I think right now we want to continue to prove reliable earnings and very sustainable earnings. Then as that comes along and we start to see multiple re-rate through that, I think cash dividend absolutely is part of the equation. Yes, sir.
What's driving the push to electric and how much risk is there if, under the [audio distortion]
Yeah. Even if any regulations disappear, what we're seeing with the electric equipment and what our customer base is seeing with the electric equipment is we're able to operate for a lower cost for them. Now, it doesn't necessarily mean a cheaper pumping price, but if they've got gas already on their locations throughout their acreage that they're trying to figure out what to do with besides just flare and burn, they're able to fuel this entire equipment. Instead of purchasing 30,000 gallons of diesel per day at $2.50 per gallon, they've got free fuel for this entire fleet that is more efficient on location than any diesel or dual fuel equipment that's out there.
If you have a large diesel engine that's twice the size of this table and a transmission on the back of it, how many moving parts, how many oil changes, filters, everything that you're going to have to constantly do to keep that engine going and high performing day in, day out, you remove all of that and you put an electric motor there that's just like a light switch when you turn on your ceiling fan. When you flip it, you expect it to turn on and start working, right? It's the exact same thing on an electric motor on a frac pump. It's reliable. It's more efficient, less cost for us, and lower cost for the operator because they're able to utilize the gas that they have already on location.
For ProPower equipment, is it movable or is it really built on site and it's there forever?
No, it's either on wheels or skid based. So it'll be either mobile or modular. Most of what we're going to do is probably going to end up being modular because it doesn't need to have wheels, but we'll have some equipment that has wheels just to be able to rotate for maintenance purposes.
[audio distortion]
Yes, sir.
You talk about your use of debt. I guess I'm just confused. Your stock's still undervalued. Six months ago, you were very excited to buy back the stock at $7.50 or $8. And now at $5.50 or $6, not so much. I guess my question is, why not sort of do both?
Yep. Great question.
Yeah. I mean, I think our perspective on that is certainly ProPower requires a lot of capital today. We have increased the orders since six months ago when we even initially announced the business for an initial 110 megawatts. We have since increased that to 220. That is going to require excess capital. We have said that we expect to fund that largely through cash flow, right? We did announce our initial 110 MW was going to be financed, $104 million of financing. I think right now, just given some of the near-term headwinds, it is really prudent to protect our balance sheet and make sure we have cash on hand. We look at it every day. I think at these prices, yeah, it is certainly attractive. Right now, the returns that we think we can get through ProPower, that is where our money is going.
What would it cost you? Why not just fund ProPower with debt? You've got 15- or 20-year assets. Presumably, you're going to pay back in four years. Why not just borrow $300 million and give it to Travis and say, "It's work your magic"?
Sure. We're looking at that. Absolutely. Historically, oilfield service companies are not viewed favorably when they have a bunch of debt. This is.
[audio distortion]
Yeah. No, yeah, exactly. You're into a different asset base. Yeah. I know exactly what you're talking about. We evaluate that. And there could be a balance of that going forward a little bit, but I think we still want to have a strong balance sheet, even if we added some more debt for power. We still want to have a strong balance sheet with cash and still have that opportunity to continue to repurchase shares as well. I think it's going to be a mix, but we think there's a—not think, we know there's a large opportunity for ProPower. And we're trying to be responsible to the shareholders as much as possible to fund that machine and be able to run our business without showing that you're stacking up, being irresponsible with lots of debt going forward.
[audio distortion]
Yes, sir. Anyone else?
We've got a couple of minutes, so it could be good.
Yeah. Thank you guys very much. We'll be around the rest of the day. Look forward to meeting every one of y'all. Like they said, stock tickers, PUMP, Pump. Look forward to you guys following it and watching ProPower grow. Thank y'all.
Appreciate it.