Schlumberger’s Profit Rises 63% on Increased Oil, Gas Drilling

Schlumberger Ltd., the world’s largest oilfield-services provider, said first-quarter profit rose 63 percent as oil and gas producers ramped up spending on exploration.

Oil and gas producers are spending more on exploration as new reserves become more difficult to locate. That’s raising demand for seismic mapping, pressure-pumping and other services provided by Schlumberger and its competitors.
Schlumberger Chief Executive Officer Andrew Gould, 60, has forecast double-digit growth through the end of the decade.

The company’s shares are the second-costliest by price- earnings ratio behind Transocean Inc. in the 15-member Philadelphia Oil Service Index.

“You can’t say it’s a screaming bargain,” Don Hodges, co-manager at Hodges Capital Management in Dallas, Texas, said. “But if you look out two or three years down the road, I’m saying they’re going to be doing more business than they are now and getting a better fee for it. The demand worldwide for oil is growing.”

Bloomberg