Schlumberger narrows its loss in fourth quarter
Schlumberger, the world’s largest oilfield services provider, tightened its loss in the fourth quarter of 2016, compared to the year-before period, amid an 8 pct drop in revenues.
During the fourth quarter of 2016, Schlumberger’s net loss decreased by 80% to $204 million, from $1.02 billion in the corresponding period in 2015.
Schlumberger recorded a $536 million restructuring charge in the fourth quarter and a $139 million of charges relating to the Cameron integration and a currency devaluation loss in Egypt.
The company’s revenues for the fourth quarter of 2016 dropped by 8% amounting to $7.1 billion, compared to $7.74 billion in the same quarter of 2015.
Furthermore, fourth-quarter cash flow from operations during the quarter was $2 billion.
Schlumberger Chairman and CEO, Paal Kibsgaard, commented: “E&P spending surveys currently indicate that 2017 NAM E&P investments will increase by around 30%, led by the Permian basin, which should lead to both higher activity and a long overdue recovery in service industry pricing.
“In the international markets, operators are more focused on full-cycle returns and E&P investments are generally governed by the operators’ free cash flow generation. Based on this, we expect the 2017 recovery in the international markets to start off more slowly, driven by the economic reality facing the E&P industry. This will likely lead to a third successive year of underinvestment, with a continued low rate of new project approvals and an accelerating production decline in the aging production base.
“These factors together are increasing the likelihood of a significant supply deficit in the medium term, which can only be avoided by a broad-based global increase in E&P spending, which we expect will start unfolding in the later parts of 2017 and leading into 2018.”
Schlumberger’s capex, excluding multiclient and SPM investment, is expected to be $2.2 billion for 2017. Capex for the full year 2016 was $2.1 billion.
Offshore Energy Today Staff