HOUSTON, April 4 (UPI) -- Joining forces gives both companies an edge in drilling and production systems, oil field services company Schlumberger said after acquiring a rival.
Schlumberger, the world's largest oil field services company said it closed on its merger with its smaller industry counterpart Cameron International Corp. Schlumberger CEO Paal Kibsgaard said the combination means improved efficiency across the board.
"We are ready to begin the process of realizing the synergies made possible by this merger and our focus in the near term is on the execution of our integration plans, while continuing to deliver safety and quality in our field operations," he said in a statement.
Schlumberger made the offer for the Houston-based maker of tools for oil field development in August, saying the combined entity would have a "pore-to-pipeline" footprint in the industry. Last month, Kibsgaard said the industry downturn, which for Schlumberger meant a 9 percent decline in fourth quarter profit, suggested industry performance could only be improved by adopting new business models in a depressed oil market.
"This is an exciting time for all Cameron employees as we integrate our portfolio with Schlumberger technologies to deliver improved operational performance, higher levels of cost efficiency, and close commercial alignment through new risk-based business models, while continuing to focus on the needs of our customers," Cameron CEO Scott Rowe said.
Schlumberger said the decrease for inland exploration and production activity was the sharpest in 30 years as capital spending by North American players declined more than 40 percent last year. In the United States alone, the 2015 rig count was down nearly 70 percent from the previous year.
Lower crude oil prices have left companies servicing the energy sector with less capital as spending declines for exploration and production. Industry rivals Halliburton and Baker Hughes aim to join forces to endure the downturn, though their combination has been bogged down by competition concerns in the European Union.