Halliburton buoyed by oil sector outlook as LatAm activity surges

US oilfield services firm Halliburton expects tightening supply and soaring commodity prices to bolster its international business for the remainder of 2022 amid surging demand from customers in Latin America, executives said in a quarterly earnings call. 

The comments came as the company reported a 15% year-on-year increase in first quarter international revenue, driven largely by projects in Brazil, Argentina and Mexico.

"We're going to see activity build throughout the balance of 2022 and [that growth] will probably continue to get legs in 2023 and beyond," CEO Jeff Miller told investors and analysts.

"The key is that at 100-dollar oil, everybody is busy and people want to be busy. But, the question is, can they be busy? What we've seen is really seven years of underinvestment around the world, with spending about half of what it used to be. And that's not something that's overcome in a day or even a year."

Halliburton's first quarter revenue in Latin America jumped 22% year on year to US$653mn. In addition to higher activity across multiple product service lines in Brazil, Argentina and Mexico, Halliburton cited well construction services in Colombia, completion tool sales in Guyana and project management in Ecuador as key growth drivers. 

Those segments were partially offset by reduced fluid services in the Caribbean as well as falling project management and stimulation activity in Mexico, according to the Houston-based company.

Miller said operators would likely continue to prioritize short-cycle projects this year to capitalize on the high-price environment. 

"Clearly, every quarter the trajectory changes and I'm very excited about those changes," he said. "Everything we see ... sets up a busier North America and strong growth internationally. And the key is that we're seeing them both at the same time."

Halliburton reported first quarter net income of US$263mn, up from US$170mn in the same period last year.