Wood Group Expects US Shale To Drive 2014 Growth
LONDON, Feb 18 (Reuters) – British energy services company Wood Group said on Tuesday it expected strong demand for services in U.S. shale to drive overall growth despite a weaker outlook for its core engineering division.
Wood Group recently increased its exposure to the onshore oil and gas market in the United States, acquiring Wyoming-based services firm Elkhorn last November, and Chief Executive Bob Keiller said the acquisition should help deliver growth this year.
Wood Group shares rose 4 percent in morning trade, against a broader oil and gas index that was up just 0.1 percent.
Oil services experienced a difficult 2013, peppered by profit warnings, as years of bumper profits fed by a high oil price and record investment by oil companies came to an end.
Wood Group's engineering division, which accounts for around half the company's profit, provides equipment and pipelines and performs work on oil-well integrity and corrosion management.
The company expects the division's profits to fall in 2014 as oil companies cut back on spending and delay or cancel new projects.
But Keiller told reporters that slowdown would be more than compensated by growth in the contractor's services division – Wood Group PSN.
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