Schlumberger To Slash Spending by 30 Percent
Oilfield services giant Schlumberger plans to slash spending by 30% this year compared with 2019 levels as the energy markets continue to struggle with an upended economy, the COVID-19 outbreak and the Saudi-Russia price standoff.
In a webcast presentation at this year’s Scotia Howard Weil Energy Conference, Chief Executive Officer Olivier Le Peuch commented that the company expects a rapid reduction in rig count and completions activity in onshore North America, adding that the number of operating rigs could dip to low levels last seen in 2016.
Earlier this year, Schlumberger revealed a strategy to trim costs tied to its North American operations, which helps position the firm to weather the latest market shifts, Le Peuch said. For those operations, the company is now accelerating its restructuring along with reductions in personnel and compensation.
Le Peuch said the spread of the virus will likely affect some field crews and operations, and while the company was preparing for logistical disruptions as countries implement restrictions, it didn’t know the extent of the reductions ahead.
Exploration companies and service providers alike have scrambled to cut budgets and right-size operations for months. Late last week rival Halliburton shared furlough plans that impacted 3,500 workers in Houston.
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