Two days after reporting solid third quarter results, Schlumberger Ltd. changed its brand to SLB, underscoring its vision for a “decarbonized energy future.”


The bellwether oilfield services (OFS) operator, the world’s largest, rebranded to the New York Stock Exchange symbol to affirm its evolving focus on “driving energy innovation for a balanced planet” as a global technology firm.

“Today we face the world’s greatest balancing act – providing reliable, accessible and affordable energy to meet growing demand, while rapidly decarbonizing for a sustainable future,” said CEO Olivier Le Peuch.

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“This dual challenge requires a balance of energy affordability, energy security and sustainability,” he said. “It requires a balance of innovation and decarbonization in the oil and gas industry, as well as clean energy solutions. It requires a balanced energy mix for a balanced planet.”

‘Off To A Great Start’

During the conference call to discuss quarterly results, Le Peuch said, “The second half of the year is off to a great start, with strong third quarter results that reflect the acceleration of international momentum and solid execution across our divisions and areas.”

The international rig count is 25% lower than in late 2019 – before the pandemic disrupted demand – but sales in the latest quarter surpassed revenue in 3Q2019.

“This comparison highlights the significant gains we have made in strengthening our market participation and our continued growth potential as rigs mobilize internationally in the quarters to come,” Le Peuch said. The international business has “stepped up significantly, complementing already robust levels of activity in North America.”

Le Peuch again urged global oil and gas players to invest in more drilling and sanction projects to rebalance the supply and demand in the energy market.

“While concerns remain over the broader economic climate, the energy industry fundamentals continue to be very constructive,” he said. “Against the backdrop of the energy crisis and limited spare global capacity, the world faces an urgent need for increased investment to rebalance markets, create supply redundancies and rebuild spare capacity. All of these are exacerbated by geopolitics and increasing instances of supply disruptions.

“These dynamics and the urgency to restore balance are resulting in a supply-led upcycle, characterized by the decoupling of upstream investment from near-term demand volatility. Furthermore, the need for sustained investments is reinforced by the long-term demand trajectory through the end of the decade and by OPEC-plus decisions that are keeping commodity prices at supportive levels.”

Committed To Lower Carbon

Concurrently, he said, “we are witnessing a significant commitment from the industry to decarbonize oil and gas.” Exploration and production operators “all over the world are deploying capital and adopting technologies, including digital, at scale to reduce emissions. Taken together, we expect these constructive fundamentals and secular trends to support multiple years of growth.”

In North America, revenue of $1.5 billion was essentially flat sequentially as double-digit growth in U.S. land revenue was offset by reduced exploration data sales in the Gulf of Mexico. U.S. land sales “outperformed the rig count increase sequentially due to higher drilling activity, increased sales of well and surface production systems, and improved pricing.”

Total sales growth in 3Q2022 was led by Well Construction and Production Systems as global activity strengthened. particularly in the offshore and international markets. The latest quarter also was supported by “continued backlog conversion, strong technology adoption and the growing effects of pricing improvements,” management said.

Reservoir Performance also improved from a year ago. However, Digital & Integration declined as growth in digital solutions was offset by the “non-repeat of exploration data transfer fees” that were recorded in 2Q2022.

‘Compelling Investment Outlook’

“As we close the year, we expect to deliver sequential revenue growth and margin expansion in the fourth quarter,” Le Peuch said. “To conclude, we have stronger conviction in our strategy and the opportunities across our three engines of growth – the Core, Digital and New Energy. 

“Constructive market fundamentals for oil and gas, energy security and the urgency to accelerate the energy transition will support increased investment – in both clean energy technology development and lower carbon oil and gas production. 

“We have positioned the company for long-term outperformance, with a diverse set of opportunities across the entire energy value chain. These technology-led opportunities cover oil and gas, industrial decarbonization and new energy systems, all supported by digital transformation.”

The CEO said “recent regulatory decisions and incentives reinforce our view of this compelling investment outlook and our strategic direction…I am truly excited about our future as we continue to drive innovation for a resilient and balanced energy system.”

Net income beat estimates at $907 million (63 cents/share) in 3Q2022, versus year-ago profits of $550 million (39 cents). Adjusted earnings and pre-tax segment operating margin was 18.7%, the highest since 2015.

Total revenue in 3Q2022 jumped 28% year/year to $7.48 billion, with international operations carrying the day at $5.88 billion. International sales rose 13% sequentially and were 26% higher than a year ago.