Schlumberger sees strong Q2 2011 results

Schlumberger_results

Schlumberger reported Q2 2011 revenue of US$9.6 billion against US$8.7 billion in the first quarter of 2011, and US$5.9 billion in the second quarter of last year.

Income stood at $1.18 billion, which is an increase of 22 per cent sequentially and 45 per cent YoY. Oilfield Services revenue hit US$8.9 billion, an increase of 11 per cent sequentially and 51 per cent YoY. The drilling group saw revenue of US$3.4 billion, 127 per cent higher YoY.

Pretax segment operating income of US$1.75 billion was up 20 per cent sequentially and 56 per cent YoY. Schlumberger Chairman and CEO Andrew Gould commented, "Second-quarter results showed strong growth worldwide. All Product Groups grew at double-digit rates.

Internationally, the trend towards higher deepwater rig count, and higher exploration spending continued. This activity was coupled with a surge in development and workover activity as producers moved to compensate for reduced Libya barrels and to profit from higher prices."

Gould added: "As a result, all groups had standout product lines in the quarter and technology sales showed good progress. Strong advances were made in all technologies linked to deepwater exploration and complex development drilling including WesternGeco, Drilling & Measurements, M-I SWACO, and openhole Wireline and Testing services."

Middle East revenue recorded significant double-digit growth across all Groups with increases led by Wireline, Well Services and Drilling & Measurements. Significant expansion was experienced in the Saudi Arabia, Bahrain and Iraq.

New contract awards during the quarter also illustrated the growing strength of international activity. Schlumberger highlighted the deal with LUKOIL Mid East for the processing and interpretation of newly acquired 3D seismic data with subsequent construction of a 3D geological model for use in the development of the West Qurna 2 Oilfield Development Project in Iraq.

The Drilling Group continued to record strong synergistic revenue with the legacy Smith Bits and Drilling Tool businesses in many areas of the world.

In the UAE, Drilling & Measurements StethoScope formation-pressure-while-drilling technology was successfully deployed for several companies to enhance operational safety, obtain pressure measurements in challenging conditions and make informed decisions on completion design.

At Reservoir Production, high growth rates were experienced internationally as operators moved to improve production and to test unconventional gas plays in several markets. Well Services posted high double-digit growth in the Middle East and Asia Area in the Saudi Arabia, Bahrain, Kuwait and Oman.

Schlumberger outlined the key constituents of supply and demand for oil and gas over the next few years and pointed out that substantial increases in investment would be necessary to maintain an adequate supply cushion in an era of political uncertainty.

"We anticipated that the international supply response would progressively ramp up over the second half of 2011. It transpired that the international ramp-up made a strong start in the second quarter that will continue through the rest of the year and into 2012," Schlumberger concluded.

Alain Charles Publishing, University House, 11-13 Lower Grosvenor Place, London, SW1W 0EX, UK
T: +44 20 7834 7676, F: +44 20 7973 0076, W: www.alaincharles.com

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