Halliburton profit jumps amid North American fracing comeback
HOUSTON (Bloomberg) -- Halliburton Co. boosted profit in North America thanks to higher prices charged for fracing work in the world’s busiest drilling region. The company’s stock climbed more than 2% before the market opened.
The view of the North American market from the top provider of hydraulic fracturing work contrasted with comments from rivals last week who saw slower growth from the U.S. and Canada. Excluding one-time items, third-quarter profit was 4 cents-a-share higher than the average estimate of 34 analysts in a Bloomberg survey.
Halliburton has benefited from rising orders for North American fracking work in the continent that generates half the company’s sales. Explorers have been curtailing new drilling in U.S. shale fields in favor of operating wells that have been drilled but not fraced to remove oil trapped within the shale below.
“Our North American business is hitting on all cylinders and our international business proved resilient in a challenging environment,” CEO Jeff Miller, said Monday in a statement announcing third-quarter financial results. “These results demonstrate why Halliburton is the execution company.”
The company earned $365 million during the period, compared with $6 million, or 1 cent, a year earlier, according to the statement. Total revenue of $5.4 billion was $101 million higher than the average estimate from analysts.
Halliburton is the largest provider of the well-completion technique that blasts water, sand and chemicals underground to release trapped hydrocarbons. When combined with other services such as drilling and cementing wells, the company is the world’s No. 3 oilfield contractor.
Schlumberger Ltd. and Baker Hughes, the world’s biggest oilfield service companies, said last week that North America’s growth engine is slowing. The investment appetite by U.S. and Canadian explorers “seems to be moderating,” with the top priority now being cash preservation rather than production growth, Schlumberger said in an earnings statement on Friday.
U.S. explorers last week curbed the number of rigs drilling for crude for a third straight week amid the growing realization that more-sophisticated and powerful equipment means less than half as many rigs are required to meet growth targets as would have been needed during the pre-2014 boom years.
