Schlumberger Reports Big Gains From US Shale Market

The world's largest oilfield services company said its revenue is continuing to grow in North American shale and even internationally, as the industry slowly creeps toward a rebound.

Schlumberger's second-quarter progress is primarily driven by the booming US onshore market, especially in West Texas' Permian Basin, Chron.com reported.

"The company's onshore North American revenue jumped a whopping 42% from the first quarter of the year. That compares favorably to a 23% increase in the active US drilling rig count during the same period," Schlumberger CEO Paal Kibsgaard said.

But despite Schlumberger's second-quarter revenues of $7.46 billion showing positive growth, the energy giant still posted a quarterly loss of $74 million because of $510 million in one-time impairment charges, primarily from its work in Venezuela, which remains mired in political and economic turmoil.

The relatively small loss compares to a massive $2.2 billion loss during the second quarter last year, but less than a $279 million gain during the first quarter of 2017. Still, Schlumberger touted its 8% revenue gain from the first quarter and a 4% improvement versus last year.

Even with US oil prices remaining mired below $50 a barrel, Kibsgaard sees positive gains.

"Despite the significant costs associated with reactivating equipment, all of our US land product lines were profitable in the second quarter, driven by higher pricing, market share gains, improved operational efficiency, timely resource additions and proactive supply chain management," he said.

The biggest boost of all came from a 68% jump in US revenues from hydraulic fracturing, or fracking, as the industry heats back up. Schlumberger's international revenues even jumped 4% from the first quarter.

"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 with increases in activity," Kibsgaard said.

"The strengthening in the international markets has so far been concentrated around land activity in Western Siberia and in the OPEC Persian Gulf countries, but we are now also seeing an increasing number of new offshore projects being prepared ... in many of the world's shallow water basins."