Contract Driller Nabors' Revenue Rises On US Shale Spending
Oct 22 (Reuters) - Contract driller Nabors Industries Ltd reported a 17 percent rise in revenue, its highest increase in nine quarters, as it benefited from strong spending in U.S. shale fields.
The company, owner of the world's largest land-drilling rig fleet and a major provider of fracking services, said the recent fall in oil prices could affect customer spending but it was well positioned to weather any downturn.
Nabors' shares rose about 2 percent in extended trading on Tuesday.
"We are acutely aware of the potential for further weakness in crude oil prices and the associated impact on our customers' spending plans, particularly in North and Latin America," Chief Executive Tony Petrello said.
However, he said Nabors was "much better positioned" to deal with - and even capitalize on - any cuts in spending after undertaking cost-cutting intiatives of its own.
Onshore drillers such as Nabors are expected to be less affected by falling oil prices than offshore drillers, whose customers need higher prices to break even.
Nabors said its adjusted income from drilling and rig services in the United States rose about 26 percent to $117.2 million in the quarter, thanks to higher activity in the Bakken shale field in North Dakota and Permian Basin in Texas.
Its U.S. business also benefited from the receipt of a previously announced $30 million contract termination payment.
The increased drilling activity also boosted demand for pressure pumping, a market that is recovering after being oversupplied over the past two years.
Pressure pumping is used in hydraulic fracking for extraction of oil and gas from the shale wells.
Nabors' revenue rose to $1.81 billion from $1.55 billion a year earlier, beating the average analyst estimate of $1.72 billion, according to Thomson Reuters I/B/E/S.
The company reported net income from continuing operations of $57.4 million, or 19 cents per share.
That compared with a loss of $90.5 million, or 30 cents per share, a year earlier when it was hit by a payment associated with bond redemptions and asset impairment charges.
Excluding items, earnings were 39 cents per share, exceeding the average estimate of 36 cents.
Nabors shares were trading at $19 after the bell, up from $18.65 at the close on the New York Stock Exchange.
Up to the close the stock has risen 10 percent this year, compared with a 2 percent fall in the Dow Jones U.S. oil equipment and services index.
(Reporting By Kanika Sikka in Bangalore; Editing by Ted Kerr)
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- Gunvor CEO Sees Russian Refining Capacity Taking Hit from Drone Strikes
- These Factors Helped Brent Oil Price Break Above $85
- Sinopec Engineering Posts Higher Annual Petrochemicals Revenue
- Imperial Pipeline in Winnipeg Goes Offline for Three Months
- Gaz System to Acquire Gas Storage Poland
- Subsea7 Secures Contract to Service Woodside's Trion
- Adnoc Inks Supply Deal for Ruwais LNG Project with Germany's SEFE
- TotalEnergies to Acquire TLCS Eyeing Bayou Bend CCS Project
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Rystad Looks at the Buzz Around White Hydrogen
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension