SLB targets deepwater opportunities in LatAm

The development of new deepwater basins in Latin America and beyond will deliver new growth opportunities to oilfield services giant SLB, CEO Olivier Le Peuch said on Friday.

In a conference call discussing the second quarter earnings of the company formerly known as Schlumberger, Le Peuch provided an upbeat assessment of the global outlook for deepwater development. 

Le Peuch said deepwater growth is being driven by existing projects, upcoming investments by operators, and ongoing exploration and appraisal activity.

"There is a strong portfolio of projects underway, from Guyana to Brazil, from Norway to parts of Asia... this will add years of growth to the deepwater outlook. It is a market with multiple legs."

Le Peuch highlighted the Pelotas basin in Brazil as an emerging opportunity for SLB.

"The ongoing strength of the offshore market supported further growth in Europe and Africa as well as Latin America," he said. "This was particularly pronounced in deepwater basins including Brazil."

SLB's international revenue grew by 18% year-on-year to US$7.45bn, offsetting a 6% decline in North America. It was the company’s highest quarterly international revenue since 2014.

In Latin America, SLB's revenue increased 7% year-on-year to US$1.74bn, due to higher sales of production systems in Brazil and robust drilling activity in Argentina. 

These trends were partially offset by lower drilling revenue in Mexico, where international oil companies have reduced their activities.

Latin American operations provided 19% of SLB's total revenue of US$9.14bn in the second quarter. Net income was up 8% at US$1.11bn.

In Mexico, SLB said that national oil company Pemex has chosen its well stimulation service as its preferred stimulation system to increase production in its strategic fields. That follows a successful initial implementation of the technology at a Pemex well, which SLB said resulted in a 3.6-fold production increase.