--Schlumberger CEO not yet seeing signs of slowdown in
international oil-related activity
--In U.S., Schlumberger expects declining hydraulic-fracturing
margins to continue into next quarter
--Increased activity in U.S. Gulf of Mexico is offsetting
falling margins in fracking services
(Updates with additional comments from conference call.)
HOUSTON--Schlumberger Ltd. (SLB) isn't seeing signs of a
slowdown in international activity, despite increasing concerns
related to a shaky global economy, Chief Executive Paal Kibsgaard
told investors Friday.
"Absent a future setback to the world economy, [we maintain] our
stated view that international activity will grow in excess of 10%
this year," he said during a conference call.
In the U.S., however, the company expects the trend of falling
hydraulic-fracturing margins to continue into the next quarter, as
the market is still dealing with excess capacity, especially for
pressure-pumping services.
"Rig moves from the gas basins to the liquid rich basins
continued," Mr. Kibsgaard said. That phenomenon is raising costs
for most oil-field services companies.
However, increased activity in the U.S. Gulf of Mexico is
offsetting declining margins in fracking services, Mr. Kibsgaard
said.
Mr. Kibsgaard cautioned that both in the U.S. and
internationally unstable or falling oil prices could dampen
activity going forward, though there have been no signs of that
yet.
Mr. Kibsgaard highlighted increased demand for "high end"
oil-field services in China and said Russia is on track to be one
of the company's fastest-growing markets.
He said Argentina's nationalization of energy company YPF SA
(YPF, YPFD.BA) creates some short-term uncertainty, but he said the
company's outlook is positive in the medium and long term.
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