WesternGeco
Posted: 03 November 2004
Third-quarter revenue of $301 million was 3% higher sequentially and 14% higher compared to the same period last year. Pretax operating income of $33 million improved $19 million sequentially and $70 million year-on-year.
Sequentially, Marine activity increased 7% due to better vessel utilization, particularly for Q-Marine* technology. The activity growth was strongest in West Africa, Mexico and South America. Land declined 8% reflecting the completion of some projects in Malaysia and the Middle East. Multiclient sales increased 3% mainly in North America, partially offset by the completion of a long-term volume agreement awarded in December 2003. Data Processing increased 10% due to a higher level of Q* processing and robust third-party work coupled with improved operational efficiencies.
Year-on-year revenue increased mainly from strong growth in Multiclient sales coupled with higher activity in North America. This reflected the renewed interest in the library resulting from higher oil prices and an increasing number of blocks in the Gulf of Mexico coming up for renewal. Data Processing grew 29% resulting in increased amounts of Q processing and improved third-party backlog. Land revenue was flat year-on-year while Marine declined 9% due to lower activity in the Caspian coupled with an ocean-bottom cable crew operating on a substantially pre-funded Multiclient project in the Gulf of Mexico.
Sequential operating income increases were mainly in Marine resulting from higher vessel utilization and sustained Q pricing. Data Processing also contributed to this improvement due to better operating efficiency.
The year-on-year operating income increase was led by Multiclient due to lower amortization cost following the impairment of the Multiclient library in the third quarter of last year, coupled with improved sales in North America. Marine also contributed to the improved performance with better pricing on Q contracts.
Market acceptance of Q technologies continued to accelerate with revenue more than doubling sequentially and almost tripling year-on-year.
The WesternGeco backlog at the end of the third quarter reached $602 million, increased 1% over the previous quarter and more than doubled year-on-year.
Highlights:
- Driven by Q-Marine vessel utilization, WesternGeco recently decided to add the Western Regent to its Q-Technology* seismic vessel fleet. The vessel is scheduled for deployment in the first half of 2005.
- Statoil ASA awarded WesternGeco a contract for two Q-Marine 4D monitor seismic surveys over the Heidrun and Norne Fields in the Norwegian sector of the North Sea. Both assignments repeat earlier Q-Marine surveys. In addition, an agreement was signed for the industry's first long-term seismic reservoir monitoring program. Through this agreement WesternGeco becomes Statoil's preferred contractor for time-lapse seismic surveys over the Norne and Heidrun Fields for five- and six-year periods, respectively.
- Reliance Industries Limited awarded WesternGeco a Q-Marine contract to acquire a large seismic survey covering two assets located in the Bay of Bengal, India.
- Lukoil awarded WesternGeco a contract for two land crews in Saudi Arabia.
- WesternGeco recently completed a 3D four-component ocean-bottom cable seismic survey at Cannonball for BP Trinidad and Tobago LLC.
Posted by Alexander Lindsay, Editor Pipeline Magazine
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