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Schlumberger (SLB) Wins $381.18-Million Award From ADNOC
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Schlumberger Limited (SLB - Free Report) recently clinched a deal from Abu Dhabi National Oil Company (ADNOC). The oil and gas giant of UAE has awarded contracts worth $763.7 million for integrated rigless services, which will be carried out across six artificial islands located in the Upper Zakum and Satah Al Razboot fields near Abu Dhabi.
The move from ADNOC is expected to boost production capacity from the fields to 5 million barrels per day by 2030. It expects more than 80% of the award value to flow back to the country’s economy, which is recovering from the pandemic woes. The awards require a range of services like coiled tubing, equipment, well testing, wireline, simulation services, well integrity and others.
The portion of award received by Schlumberger is valued at $381.18 million. Another oil and gas equipment and service provider, Halliburton Company (HAL - Free Report) received a $153.87 million worth of deal. ADNOC Drilling, wherein Baker Hughes Company (BKR - Free Report) acquired a 5% stake in 2018, also received part of the award worth $228.71 million.
The award for Schlumberger and other companies reflects an improving international market condition. While tepid upstream investment in the domestic market prevails, the international market can drive growth for oilfield service providers through 2021-end and beyond. Regions like the Middle East, North Sea and others are expected to provide opportunities to companies with major global presence.
Earlier, Schlumberger stated that it foresees an increase in optimism for fuel demand recovery in 2021, thanks to the rolling out of coronavirus vaccines and economic stimulus measures. Schlumberger expects demand to increase by 2021-end. As such, the company expects international revenues to witness double-digit growth in second-half 2021.
Price Performance
The company has gained 35.4% in the year-to-date period compared with 13.5% rise of the industry it belongs to.
Image: Bigstock
Schlumberger (SLB) Wins $381.18-Million Award From ADNOC
Schlumberger Limited (SLB - Free Report) recently clinched a deal from Abu Dhabi National Oil Company (ADNOC). The oil and gas giant of UAE has awarded contracts worth $763.7 million for integrated rigless services, which will be carried out across six artificial islands located in the Upper Zakum and Satah Al Razboot fields near Abu Dhabi.
The move from ADNOC is expected to boost production capacity from the fields to 5 million barrels per day by 2030. It expects more than 80% of the award value to flow back to the country’s economy, which is recovering from the pandemic woes. The awards require a range of services like coiled tubing, equipment, well testing, wireline, simulation services, well integrity and others.
The portion of award received by Schlumberger is valued at $381.18 million. Another oil and gas equipment and service provider, Halliburton Company (HAL - Free Report) received a $153.87 million worth of deal. ADNOC Drilling, wherein Baker Hughes Company (BKR - Free Report) acquired a 5% stake in 2018, also received part of the award worth $228.71 million.
The award for Schlumberger and other companies reflects an improving international market condition. While tepid upstream investment in the domestic market prevails, the international market can drive growth for oilfield service providers through 2021-end and beyond. Regions like the Middle East, North Sea and others are expected to provide opportunities to companies with major global presence.
Earlier, Schlumberger stated that it foresees an increase in optimism for fuel demand recovery in 2021, thanks to the rolling out of coronavirus vaccines and economic stimulus measures. Schlumberger expects demand to increase by 2021-end. As such, the company expects international revenues to witness double-digit growth in second-half 2021.
Price Performance
The company has gained 35.4% in the year-to-date period compared with 13.5% rise of the industry it belongs to.
Image Source: Zacks Investment Research
Zacks Rank & Key Pick
Schlumberger currently has a Zacks Rank #3 (Hold). A better-ranked stock from the energy space is Murphy Oil Corporation (MUR - Free Report) , having a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Murphy Oil’s bottom line for 2021 is expected to surge 131.2% year over year.