Schlumberger has posted second-quarter revenue of US$8.3 billion, an increase of 11% compared to a year ago, and is flagging an increase in exploration and production spending in a brightening disposition.
The company said revenue was primarily lifted by a 43% lift in operations in North America to US$3.1 billion.
Schlumberger said offshore activity began to recover during the second quarter with new drilling projects in Eastern Canada, the US Gulf of Mexico, and the Caribbean, resulting in sequential offshore revenue growth of 22%.
Schlumberger’s international business revenue was a little over $5 billion, which was one percent down compared to the second quarter of last year.
Schlumberger CEO Paal Kibsgaard said things were looking sunnier for the international oilfield services business with a broader-based international recovery also emerging.
“Pricing improved in the international markets during the second quarter, and while the numbers are not yet material, a trend has been established and customer pricing discussions are continuing both for new and existing contracts,” Mr Kibsgaard said.
“Despite OPEC’s recent decision to increase production, the global supply base continues to weaken”
“With a number of large-scale project awards absorbing our remaining spare capacity in both drilling and production services, our equipment will be fully deployed during the fourth quarter, after which we expect a further strengthening of the international pricing recovery.”
Schlumberger reported a net income for the quarter of $430 million, compared to a loss of $74 million a year ago.
Kibsgaard added: “Despite OPEC’s recent decision to increase production, the global supply base continues to weaken from geopolitical pressure to remove Iranian production from the market, no apparent resolution to falling production in Venezuela, and Libyan exports continuing to be volatile.
“At the same time spare production capacity, which is essentially limited to only a few OPEC countries, is now nearing its lowest level for more than a decade while decline in the world’s mature production base continues to accelerate.
“These developments underline the growing need for E&P spending to increase significantly, particularly in the international markets, as it is becoming more and more apparent that the new projects expected to come online during the next few years will not be sufficient to meet the increasing demand.”