Energy Key Findings: November 2012
| Oilfield Services Companies Reap Benefits as Crude Gets Tougher to Find and Extract |
Oilfield Services Companies Reap Benefits as Crude Gets Tougher to Find and Extract
Oilfield services (OFS) companies are often called “the unsung workhorses of the industry.” Yet, many are getting a last laugh as their revenues continue to rival or surpass those of the major oil companies who hire them. According to McKinsey, OFS companies grossed around $750 billion last year.
OFS firms find and extract oil using cutting-edge technology, while others make and sell high-tech equipment for use on drilling rigs or the seabed, or own/lease drill-rigs. The big services companies, which invest heavily in technology, have been growing by around 10% a year.
One top OFS firm, Schlumberger, earned profits of $5 billion on revenues of $40 billion in 2011. Its market capitalization increased fourfold in the past decade, to $91 billion. That is bigger than several international oil companies, including ENI ($82 billion), Statoil ($75 billion) and Conoco-Philips ($71 billion). Other large OFS companies include FMC, Cameron, Halliburton, Baker Hughes, Transocean and Weatherford International. (The Economist)
Bullets
- Price (61%), customer service (47%) and keeping the lights on (39%) are the top factors in determining whether consumers are satisfied with their electric utility. (DEFG and Navigant Consulting, Energybiz.com)
- Global demand for oil is growing by 1-2% a year, while global production from mature oilfields is falling 2%-6% a year. (The Economist)
- Using existing technology, U.S. energy consumption could be reduced by 23% in 2020 from current levels. (McKinsey)
- The U.S. oil reserves grew by 23% from 2007 to 2011, mostly due to efforts of independent operating companies, not integrated oil companies or national oil companies. (Ernst & Young; Offshore-mag.com)