Schlumberger Earnings Beat Predicts American Oil Production Surge

The world’s largest oil fields service company Schlumberger reported better than expected Q4 earnings Friday. $SLB predicts that U.S. oil production will surge to further record levels.

Oil and gas services heavyweight Schlumberger $SLB reported better than expected Q4 earnings on Friday before the market opened. $SLB experienced expanded market share in key regions in North America and expects U.S. oil production to surge above Saudi Arabia.

 SLB Automated Drilling

Schlumberger Automated Drilling Positioning Itself in energy markets

Earnings: EPS $0.48 beat expected $0.44 on revenue of $8.179 billion, higher than the expected $8.12 billion.

Reaction: Schlumberger $SLB

Premarket $75.30 -$1.07 (-1.40%)

Highlights

  • $SLB also announced that it is exiting the marine and land seismic acquisition market
  • Booked a $938 million charge on a Venezuelan investment.
  • Signed memorandum of understanding with Occidental Petroleum $OXY for a five-year service project in New Mexico’s Delaware basin for 700 wells.

Segments

Drilling Group revenues increased primarily on contributions from the international market. Ramp up of activities in Colombia and Argentina also drove revenues. Profits at the business unit were supported by the commencement of new projects in China and Qatar.

Revenues of $2,180 million rose 8% year over year. Pre-tax operating income was $319 million, up 36% year over year.

Production Group were boosted by activities in the international market. Increased operations in Russia, Argentina and Saudi Arabia drove the segment’s fourth-quarter numbers. Surge in pricing in North America’s onshore market also contributed to the outperformance.

Revenues increased 40% from the year-earlier quarter to $3,079 million. Pre-tax operating income took off 146% year over year to $315 million.

Reservoir Characterization Group also supported by strong contributions from the international market. Rise in sales of SIS software led to increased profits.

Revenues totaled $1,638 million compared with $1,676 million in the prior-year quarter. Pre-tax operating income totaled $360 million, up 13% year over year

Cameron Group: Generated revenues of $1,414 million, up 5% year over year. Pre-tax operating income rose 8% from the prior-year comparable period to $203 million.

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Source: SLB, AlphaStrret

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