China Oilfield Services Limited, the leading integrated oilfield services provider in the offshore China market, announced its unaudited results for the three months ended 31 March, 2008. During the period under review, revenue amounted to RMB 2,503.6 million, representing an increase of 23.7% from the corresponding period last year. Net profit increased by 35.5% to RMB891.3 million. Basic earnings per share were 20 RMB cents, up 25% from that of the same period last year.
The increase in revenue was mainly attributable to: the highly efficient operation of COSL718, supporting a significant growth in income of geophysical services. Drilling services also saw significant revenue growth driven by expansion into overseas markets and increases in daily rates. Marine support and transportation services experienced growth propelled by increases in daily rates and work volume of utility vessels and chemical tankers. The well services segment achieved growth driven by an increase in work volume.
On drilling services, as at 31 March 2008, the Company operated 15 drilling rigs, including 12 jack-up rigs and 3 semi-submersible rigs. Three of these operate in Indonesia, Australia and Myanmar. During the period under review, the available day utilization rate of the drilling rigs of the Company reached 100.0%, whereas the calendar day utilization rate dropped to 86.5%, representing a decline of 10.4 percentage points, due to the increase in the number of days for maintenance. The aggregate operating days of the drilling rigs during the first quarter of the year were 1,181 days, a decrease of 127 days or 9.7% compared with the corresponding period last year.
In addition, the Company was actively expanding into module rigs and land rigs services. As in overseas markets, provision of services to clients in Gulf of Mexico using four module rigs progressed smoothly and achieved a total of 353 operating days in the first quarter and a calendar day utilization rate at 97%. As for land rigs, the Company collaborated with a local drilling company in Liberia and won a three-year contract for four land rigs. In domestic markets, land rig COSL LR7001 conducted highly difficult drilling and exploring work a 6,000-metre-deep well in Changqing Oilfield of Huan Xian in Gansu province, achieving a total of 91 operating days in the first quarter.
On well services, the work volume of each of the well services businesses was: 165 logging trips, down 22.9% from the corresponding period last year mainly due to the retreating Bohai Bay market; 163 directional drilling operations, up 8.7% driven by increased capacity resulting from leasing of equipment; filled drilling fluids for 67 wells, up 15.5% due to growth in the operation volume of production wells in offshore Nanhai; performed cementing operations on 92 wells, down 12.4% due to a reduction on work volume for projects that commanded lower prices; performed 114 well completion jobs, up 17.5% driven by the increase in work volume for filtering services in the domestic markets; and well workover of 3,880 teamDday, up 12.1% accelerating development in the domestic markets.
On marine support and transportation services, the Company operated 73 utility vessels during the period. Of these, 68 utility vessels were owned by the Company and operated a total of 5,978 days during the period, up 223 days or 3.9% from the corresponding period last year. The average day utilization rate of the Company-owned vessels in the first quarter reached 99.9%, representing a 1.0% increase compared with the corresponding period last year. The calendar day utilization rate was 96.6%, up 4.9 percentage points from the corresponding period last year. Besides, the five platform supply vessels leased from Eastern Marine Services Ltd, a jointly-controlled entity of the Company, achieved an aggregate 409 operating days in the first quarter.
On geophysical services, through completion of upgrade and conversion work carried out by Shanghai Shipyard Company Ltd., COSL719, the Company's first 8-streamer vessel which is also the most advanced geophysical vessel in Asia currently, successfully commenced operation. Due to the highly efficient operation of COSL718 in Myanmar, the operation volume of 3D data collection increased significantly by 64.5% from the last corresponding period to 3,644 sq. km. On the other hand, on 2D data collection, due to repair of BH518 in the first quarter, the work volume dropped 8.1% to 12,115 km. For data processing business, the volume of 2D data processing business was 2,910 km., down 52.7% from the corresponding period last year due to declining market demand and the corresponding reduction in coupling the decrease in the operation volume of 2D data. On 3D data processing business, due to robust market demand, the operation volume reached 2,160 sq. km., up 13.5% from the last corresponding period.
Mr. Yuan Guangyu, CEO and President of the Company, said: "With surging oil prices and continuing economic growth in countries including China and India, we anticipate further increases in the global oil consumption. The oilfield services sector will continue its prosperity. As the largest integrated oilfield services provider in the offshore China market, we shall take full advantage of this market landscape to excel in our performance through introducing more new equipment and proprietarily developed technologies, increasing work throughput, raising prices of services, exploring new markets and new businesses."
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