SLB continues to benefit from elevated activity in the Middle East & Asia, particularly in gas. (Image source: Adobe Stock)

SLB has recorded a strong performance in the Middle East & Asia in its second quarter results, with year-on-year revenue from the region increasing by 24%, compared with the 13% growth in total revenue

Revenue in the Middle East & Asia of US$3.27bn increased 6% sequentially due to increased sales of production systems and increased intervention and evaluation activity in Saudi Arabia. Higher digital revenue across the area and increased drilling in Iraq, United Arab Emirates, China, and East Asia also contributed to the sequential growth. The year on year 24% increase in revenue was due to higher drilling, intervention, and evaluation activity as well as increased sales of production systems in Saudi Arabia. Higher drilling in United Arab Emirates, Egypt, East Asia, Indonesia, and China, as well as the acquired Aker subsea business in Australia, also contributed to the year-on-year growth.

The company’s total revenue of US$9.14bn increased 5% sequentially and 13% year on year, with digital & integration and reservoir performance divisions both seeing 11% year-on-year growth, well construction 1% year-on-year growth, and production systems 31% year-on-year growth.

SLB CEO Olivier Le Peuch commented, “We achieved solid second-quarter results, with broad-based international revenue growth and margin expansion across all divisions. Our Core business continued to build on its positive momentum and our digital business accelerated, resulting in our highest quarterly international revenue since 2014. These results demonstrate SLB’s strong position in key, resilient markets, as we continue to benefit from elevated activity in the Middle East & Asia, particularly in gas, and our clients’ increased investments in deepwater basins, exploration, and digital.

“Sequentially, revenue grew 5%, led by the Middle East & Asia, which increased 6%. The increase in this area was driven by capacity expansions, gas development projects, and production and recovery, with a majority of GeoUnits in the area achieving record revenue. We also continued to benefit from our enhanced offshore exposure, particularly in deepwater basins across Latin America, Europe & Africa, and in the US Gulf of Mexico.”

Middle East contracts

In the Kingdom of Saudi Arabia, Saudi Aramco awarded SLB a long-term contract for unconventional gas directional drilling services and drilling bits, in support of Aramco’s strategic goal to increase gas production by more than 60% by 2030, compared to 2021 levels. SLB will provide innovative fit-for-basin technologies, services, and best-in-class practices developed in collaboration with Aramco.

In Qatar, a customer awarded SLB a five-year contract for directional drilling, measurement-while-drilling, and logging-while-drilling services. The contract will extend the deployment of the GeoSphere HD high-definition reservoir mapping-while-drilling service and the GeoSphere 360 3D reservoir mapping-while-drilling service for proactive steering, waterfront identification, and acquisition of valuable information for subsurface modelling.

In the decarbonisation space, SLB and Abu Dhabi National Oil Company (ADNOC) Onshore successfully deployed the EcoShield low-carbon geopolymer cement-free system, paving the way to decarbonise cementing operations. This operation achieved an estimated 85% reduction in CO2 emissions compared with conventional conductor casing cement. ADNOC and SLB are looking to expand technology application in surface casing jobs and beyond.

In Oman, ARA Petroleum Exploration and Production (ARA), part of the wider Zubair Corporation, awarded SLB a five-year contract to enhance ARA's reservoir engineering capabilities. Advanced wellbore imaging in the Techlog wellbore software will increase subsurface understanding, Petrel subsurface software machine learning will improve modelling, and Intersect high-resolution reservoir simulator will deliver precise forecasting.

The collaboration will provide and implement advanced technologies to optimise operations, enhance safety measures and minimise environmental impact across the entire value chain. (Image source: Adobe Stock)

TAQA (Industrialisation & Energy Services Company) and WellsX have announced a collaboration agreement designed to drive efficiency, sustainability and growth in the oil and gas industry

The collaboration will combine WellsX LLC’s cutting-edge digital ECO solutions and TAQA’s experience and expertise in providing top-tier services to the energy sector. Together they will provide and implement advanced technologies to optimise operations, enhance safety measures and minimise environmental impact across the entire value chain.

“We are thrilled to join forces with WellsX LLC to pioneer the next generation of energy solutions,” said Rayed Al Eskandrani, vice president of North Middle East at TAQA. “This collaboration represents a significant step forward in our commitment to innovation and sustainability, as we work together to address the evolving needs of the industry. We view it as a strategic initiative aimed at advancing sustainable clean energy development through the utilisation of AI and WellsX’s digital ECO system solution suite. The partnership embodies synergy, enabling the delivery of unmatched digital drilling and well construction solutions to clients across the Kingdom of Saudi Arabia and the broader MENA region.”

“Teaming up with TAQA presents an incredible opportunity to drive positive change in the energy sector,” said Dr. Khaydar Valiullin, vice president Drilling and Engineering at WellsX LLC. “By harnessing the power of digital technologies, we aim to unlock new levels of efficiency and performance, while also advancing the industry’s transition towards a more sustainable future and continuously leveraging local talents.”

The solutions delivered through the collaboration will optimise asset performance, streamline and automate operations, and enhance decision-making capabilities for oil and gas companies worldwide.

70% of the Ruwais LNG production capacity is already committed. (Image source: Adobe Stock)

bp, Mitsui & Co., Shell and TotalEnergies are to take a 10% equity stake each in ADNOC’s Ruwais LNG project

ADNOC will retain a 60% majority stake and serve as lead developer and operator of the project, which consists of two 4.8mtpa LNG liquefaction trains with a total capacity of 9.6mtpa. The first LNG export facility in the MENA region to be powered by renewable energy, it will be one of the world’s lowest carbon-intensive LNG facilities and is set to more than double ADNOC’s UAE LNG production capacity to around 15mtpa, as the company builds its international LNG portfolio.

ADNOC has awarded an engineering, procurement and construction (EPC) contract worth around US$5.5bn to a Technip-led joint venture and is set to commence start construction shortly, with LNG deliveries expected to start in 2028. ADNOC has signed several new long-term LNG sales commitments with international partners, including for the delivery of 1 million tonnes per annum (mtpa) with Shell and 0.6mtpa with Mitusi & Co., taking the committed Ruwais LNG production capacity to 70%.

Building on long-standing partnerships

Murray Auchincloss, bp CEO, said, “bp is proud to be joining ADNOC in its plans for Ruwais LNG, deepening our long-standing strategic partnership. This is a further example of our investment in gas growth in the Middle East as we continue to strengthen our LNG business globally.”

Wael Sawan, Shell CEO, said, “We are delighted to build on our long-standing partnership with ADNOC through the Ruwais LNG project. In line with our strategy to create more value with less emissions, we are investing in additional LNG capacity and further growing our world-leading LNG portfolio, with energy-efficient and carbon-competitive projects."

Patrick Pouyanné, chairman and CEO of TotalEnergies, said, “Last year at COP28, TotalEnergies and ADNOC both committed to lead the Oil & Gas Decarbonization Charter to reduce the industry’s greenhouse gas emissions. With Ruwais LNG, we are putting this principle into practice with one of the world’s lowest-carbon intensity LNG plants, allowing natural gas to fully play its role of transitional fuel.”

OPEC+ production in June was only marginally above its target, according to research from Rystad Energy

OPEC+ production exceeded its target by just 53,000 bpd – its lowest level since the start of the year.

Undercompliance with production cuts by the OPEC+ group hit its highest level in April 2024 since April 2021 (399,000 bpd). Since then, compliance has been rapidly improving.

In May, the group overproduced by 176,000 bpd, while in June, overproduction was just 53,000 bpd. Production in June averaged 33.903mn bpd, while the target was 33.85mn bpd.

Increased overall compliance

The increased overall compliance due to the fact that compliance among the eight voluntary cutters – Oman, Kuwait, the UAE, Algeria, Saudi Arabia, Russia, Iraq and Kazakhstan – has improved since April. This comes from lower overproduction in Kazakhstan (151,000 bpd in April down to 80,000 bpd in June), Iraq (310,000 bpd in April down to 236,000 bpd in June), Russia (253,000 bpd in April down to 176,000 bpd in June) and Saudi Arabia (82,000 bpd in April down to 6,000 bpd in June). While the UAE underproduced in June by 55,000 bpd.

The rest of the OPEC+ countries – Sudan, South Sudan, Nigeria, Gabon, Equatorial Guinea, Congo-Brazzaville, Bahrain, Azerbaijan, Brunei and Malaysia – continue to overcomply with the official cuts. 

Senior vice president Oil Market Research, Jorge León, commented, “The recent improvement in compliance levels with the OPEC+ cuts shows strong commitment and cohesion inside the group. It also shows that the compensation mechanism put into place is working. I expect to see strong compliance continuing in the coming months.”