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Going "Green" With Surplus Energy Equipment Acquisition, Disposition

September 17, 2013, 07:00 AM
Related: Used Equipment

The American consumer no longer chooses their grocery items based on price alone, often opting to buy from companies who employ organic methods of growing food or have a reputation for being “green.” The energy industry is no exception to this same decision-making process. However, sustainability in the energy industry goes beyond the traditional definition of choosing to employ the use of solar panels over oil or gas resources. With the American boom in natural gas, many oil and gas producers are updating old equipment to keep up with demand and as late model equipment becomes idle, it begs the question of what happens to those capital-intensive assets.

Leading companies in the energy sector are particularly interested in avoiding any risk to their brand, and gaps in sustainability can harbor potential damage to overall reputation. Oil and gas and mining companies are often portrayed in a somewhat negative light, providing further complications beyond the standard safety measures in risk management. This is where surplus and idle assets can become equivalent to gold for companies in the energy sector. Whether companies are dealing with late-model line pipe, hydraulic equipment, energy turbines, or even gas plants and oil rigs; choosing to dispose of the assets in a sustainable manner can improve overall “green” metrics for the company while providing working equipment for another company that may require the asset.

Allowing costly equipment to sit idle is a continued loss for the company as its value depreciates, and disposing of it in a landfill is an environmental and reputational risk. Recycling is an option that some companies include in their disposition cycle, but with the additional carbon output involved in that process the best course of action is to extend the life of the asset. Through trusted online marketplaces for surplus energy equipment buyers from across the globe shop for late-model reusable energy, oil and gas and mining equipment. Equipment leasing and financing professionals often look to established sources like our marketplaces for usable equipment, where sellers simultaneously benefit from the investment recovery on the sale of the asset and gain the sustainability lift.

Additionally, the potential for development of low-cost natural gas may be tied to energy efficiency, particularly as it has potential to be a more sustainable power source over other fossil fuels. However, the creation of new equipment to extract precious gas reserves has both a tangible cost and an environmental impact with the increased carbon to produce the asset. By reusing late-model equipment, a corporation is reducing its own environmental footprint in the process.

However, there can be risks in obtaining or selling used equipment, highlighting the importance of utilizing a trusted resource. Here are some tips to look for when acquiring or selling late-model energy equipment:

  • Commitment to Compliance: Risk is always a factor for the energy sector, so it’s critical that any source of surplus equipment employs compliance measures – both in the disposal of assets and in the transition to the buyer. A closed cycle process that ensures all requested buyer and seller compliance standards are followed will help to mitigate any potential risk.
  • Proven Environmental, Hazard & Safety (EH&S) Measures: A company’s use of EH&S measures demonstrates commitment to compliance, the environment, and the health and safety of the larger community. Reviewing marketplace credentials in this area and the experience of its team will demonstrate that the right boxes have been checked to ensure that all potential EH&S issues have been examined and properly cleared.
  • Full Transparency: The risks grow when a process is shielded from either the buyers or sellers of assets. You should expect to have a detailed explanation of the process of buying or selling an asset and receive regular reports as verification that the process is being followed in a transparent manner.
  • Extensive Experience: A third-party provider may have an impressive website or logo, but that should also be backed by an extensive resume of surplus asset management and disposition experience in a range of assets specific to the energy sector.
  • Detailed Information: Buyers are naturally drawn to marketplaces where they are not only able to count on finding the equipment they need, but also have the ability to see photos and read descriptive, relevant information about the asset. By perusing a marketplace, you can quickly notice the difference in the time and energy put into the sale of the asset and that will show up in the higher financial recovery of the asset.
  • Comprehensive Process: Your operations, supply chain, and procurement teams may have an idea of their equipment needs or the desired financial gain from the sale of  an asset, but they should also be able to count on a provider that walks them through the important factors to consider whether they are purchasing or selling an asset. You should feel they are more than a service vendor, but a partner in helping you to achieve your investment recovery, cost reduction, and sustainability strategy.

Prepared with these guidelines, any equipment leasing and finance professional has the framework to plan a best-in-class equipment acquisition and disposition strategy to increase their overall sustainability impact while protecting their brand and improving their bottom line “green” in the process. 

Gardner Dudley
Vice President & General Manager | Liquidity Services, Inc.
Gardner Dudley is vice president and general manager for Network International, a Liquidity Services’ marketplace. Dudley joined Network International in January 2000 and has held a number of positions within the company including corporate development associate, manager of the company’s Oiltizer division, and vice president of operations & technology and chief operating officer. Dudley holds a Bachelor of Arts in the Plan II Honors Program and a Bachelor of Business Administration in Finance from The University of Texas at Austin. For more information, please visit
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