The results are in and it has been a strong quarter throughout the oil and gas industry with year-on-year revenue up for the big service providers.
Earnings reports from across the board showed positive growth throughout the Middle East despite the global economic recession and political uncertainty in the region.
Schlumberger saw an 11% year-on-year increase in revenue to $10.61 billion, a 2% sequential increase. Halliburton also saw its gross income rise by 8.6%. Baker Hughes climbed more steadily with revenue at $5.23 billion, a 3% rise from compared to the same period in 2011, remaining relatively flat compared to $5.21 billion for the second quarter of 2012.
National Oilwell Varco did particularly well as it reported revenues of $5.3 billion, up 12% from the second quarter and up 42% compared from the third quarter of 2011. Revenue from the company’s Rig Technology segment rose 29% from the third quarter of 2011 or 6% sequentially to a record $2.55 billion. The company also booked $2.29 billion in new orders during the third quarter of 2012 and backlog for capital equipment orders for the segment at the end of the quarter was $11.66 billion, a 3% increase from the end of the second quarter of 2012.
Performance was driven by key regional markets both onshore and offshore which helped to offset weaknesses in North America. In a statement by Schlumberger, the slow seasonal recovery in Canada (where seasonal return of activity was almost 30 percent less than the same period in 2011), a falling US land rig count, continued oversupply of hydraulic fracturing capacity, and the effects of Hurricane Isaac were all to blame for the slow performance in North America.
Activity in the Middle East/Asia region was particularly strong. Halliburton posted an $8 million increase in operating income from its drilling and evaluation segment with group revenue for the region increasing from $875 million in September 2011, to $1.088 billion for the same period.
Paris-based Technip also posted strong revenue growth of 20% for the quarter with order intake up by $640 million from the same time last year partly due to a contract for the first EPC project of the Upper Zakum 750K development in the UAE, on which Technip performed the Front End Engineering Design.
Industry leaders were confident going into the fourth quarter, with Schlumberger expecting its international activity to grow in excess of 10% by the end of the year. The forecasts were echoed by others with Halliburton stating that its outlook for the international market has not changed, and it expects a gradual progression in margins as it ramps up activity on new projects, introduces new technologies and increases pricing on select contracts.
Baker Hughes on the other hand will continue to strengthen its Integrated Operations capabilities in the Middle East with its future work in the emerging Saudi Arabian unconventional market.
In a statement from Petrofac, the company announced that it was on target to deliver net profit growth of at least 15% by the end of 2012. Group backlog by the third quarter hit $9.4 billion, with order intakes for the year at $1.3 billion following major awards in Iraq, Saudi Arabia and Kuwait.