U.S. oilfield services company Schlumberger reported on Friday that it started the second half of 2021 with strong results, delivering another quarter of sequential revenue growth, a fifth consecutive quarter of margin expansion, and a solid free cash flow performance.
CEO Olivier Le Peuch said revenue growth was led by Well Construction and Reservoir Performance, predominantly service-oriented Divisions of the company, delivering quality revenue that more than offset the impact of transitory global supply and logistics constraints in Production Systems.
“International revenue grew 11% year-on-year and is on track to meet our double-digit revenue growth ambition for the second half of 2021 compared to the same period last year,” he said.
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The company’s returns-focused strategy continues to deliver exceptional results at this early point of the growth cycle with third-quarter pretax segment operating margin reaching its highest level since 2015 and cash flow from operations standing at $1.07 billion.
North America revenue of $1.13 billion increased 4% sequentially, with both land and offshore revenue increasing, driven primarily by Well Construction activity.
International revenue of $4.68 billion increased 4% sequentially led by double-digit growth in Latin America that was complemented by sustained activity in the Europe/CIS/Africa and Middle East & Asia areas.
Revenue in Latin America of $1.16 billion increased 10% sequentially due to double-digit revenue growth in Mexico, Argentina, and Brazil from robust activity in Well Construction, Reservoir Performance, and Production Systems, respectively.
“Revenue in Guyana, Ecuador, and Colombia also increased, driven by higher wireline and intervention activity in Reservoir Performance,” the company said.
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Europe/CIS/Africa revenue of $1.48 billion increased 2% sequentially, with growth reported in Scandinavia, Russia, Angola, and Nigeria. Peak summer drilling drove higher Well Construction activity in Scandinavia and Russia. Sustained exploration activity in Africa drove higher wireline and stimulation activity in Reservoir Performance, while Production Systems sales increased in Angola.
Revenue in the Middle East & Asia of $2.03 billion increased 2% sequentially with growth in Australia, East Asia, Indonesia, Saudi Arabia, and Qatar. Revenue in Australia and Indonesia increased from higher offshore drilling, benefiting Well Construction. East Asia revenue increased with growth across all four Divisions. In the Middle East, revenue in Saudi Arabia and Qatar grew from higher Reservoir Performance activity.
In Brazil, Petrobras awarded Schlumberger a contract for integrated completions on 21 wells in presalt concessions. The intelligent completion design chosen for these wells includes a selective open hole lower completion, integrating a premium isolation valve and downhole interval flow control valves and a Metris permanent monitoring system. Intelligent completions will enable Petrobras to enhance ultimate recovery in these higher-pressure reservoirs by more accurately monitoring and controlling production. Installation is expected to commence in the third quarter of 2022.
Offshore Trinidad and Tobago, Schlumberger helped bp achieve first gas seven months ahead of schedule in the Matapal Field. In collaboration with bp, OneSubsea leveraged its experience to deploy its first all-electric manifold and three 10,000-psi subsea trees with integral Vx Omni* subsea multiphase flowmeters. Agile subsea production systems (SPS) also enabled bp to capitalize on standardized hardware and reduce project-specific engineering. This contributed to reaching first gas in just three years from contract award, as compared to the four years for similar previous developments.
