July 21 (UPI) -- Though North America is robust, exploration and production strength is emerging in Siberia and the Persian Gulf, the world's biggest services company said.
Drilling services contractor Schlumberger reported revenue for the three months ending Jun 30 at $7.4 billion, up 8 percent from the previous quarter and up 4 percent from the same period last year. Revenue for the company expanded in all sections of its portfolio.
Companies like Schlumberger were hobbled last year when strong production trends helped drag crude oil prices below $30 per barrel and crimped spending on exploration. Though crude oil prices are still half what they were three years ago, drillers, particularly those in North America, are becoming more efficient and therefore more resilient to a weaker market.
Revenue from U.S. inland shale basins was twice that of the corresponding increase in the number of rigs on the ground. The gains were offset because of declines offshore in the U.S. Gulf of Mexico and total North American revenue increased 18 percent.
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The company said the growth came despite the "significant" costs associated with redeploying rigs back into hydraulic fracturing.
"While the activity outlook in North America for the second half of the year remains robust, we are now also seeing more positive signs in the international markets," CEO Paal Kibsgaard said in a statement. "The strengthening in the international markets has so far been concentrated around land activity in Western Siberia and in the OPEC Gulf countries."
He added that several new final investment decisions offshore are making the international market attractive.
His comments followed a recent report from consultant group Wood Mackenzie that found the oil and gas industry was steering more of its investments toward less risky and less capital-intensive projects.
The oil and gas industry has sanctioned 15 new developments, which is the equivalent of about 8 billion barrels of new reserves. That compares with final investment decisions for 12 new projects last year, or about 8.8 billion barrels of oil equivalent. Wood Mackenzie said most of those, however, were for expanding prospects that have reached a production plateau and need further stimulation, or for linking up to nearby fields already in production.
With crude oil prices struggling to break through the $50 ceiling, which was the floor price for most of the first quarter, Kibsgaard said his company would be flexible and attentive to "the shape and pace of the emerging oil market recovery."
