Precision Drilling Corp., Canada's largest oilfield services company and one of the largest in the United States, has entered into a strategic alliance with Schlumberger Ltd. to increase the "industrialization" of unconventional drilling in North America.
Schlumberger, the largest oilfield services provider in the world, plans to use Precision's Tier 1 drilling rigs and in exchange, provide Precision access to Schlumberger's bottomhole assembly and services.
The agreement applies to Canada and the Lower 48 states, and includes contract drilling services, downhole drilling and measurement technology, engineering expertise and operational training. No financial details were disclosed.
The alliance, announced Wednesday, "meaningfully advances our integrated directional drilling service offering and enables us to compete with the complete range of downhole tool technology creating a value proposition for customers that will be difficult to ignore," said Precision CEO Kevin Neveu. "The contract drilling leadership of Precision, combined with the downhole technology expertise of Schlumberger, will streamline the drilling process, reduce costs and improve results."
Precision said the agreement would allow it to expand integrated directional drilling services using Schlumberger’s downhole tools and related services.
"The agreement...will provide customers with benefits by leveraging core respective strengths of each organization to provide superior service to North American oil and gas customers," according to Neveu. "Customers will benefit through access to a leading Tier 1 contract driller with the broadest geographic footprint of any driller in North America, combined with best-in-class technology portfolio that encompasses a proven understanding of downhole conditions and overall system performance.
"The relationship targets improved drilling performance, efficiency, consistency and reduced cost of operations."
Precision brings to the alliance a North American drilling rig fleet of 320, with 190 in Canada, the remainder in the United States, including 204 mobile Tier 1 rigs. About 90% of Precision's North American activity involves horizontal or directional wells, an area in which Schlumberger executives have said they wanted to accelerate. Schlumberger is set to issue its second quarter results on Friday.