The leading oilfield services company Schlumberger Limited (SLB) launched a new stimulation technique – HiWAY – which helps maximize hydrocarbon recovery and production volumes. It is basically a hydraulic fracturing technique redefined by removing the link between flow within the fracture and proppant pack conductivity.
 
The company provides technology, project management and information services to the global oil and gas industry. These include drilling fluids, directional drilling and real-time drilling analysis as well as completion services. The new fracturing technique adds another feather to Schlumberger’s cap.
 
HiWAY is effective for the enhancement of production volumes and reduction of flowback times. With the use of this new technique, production rate for a well will increase by approximately 53% than the conventional fracturing techniques. Schlumberger has successfully deployed HiWAY in Argentina, Russia, Mexico and in the United States.
 
Given a greater need for stimulation and completion services in North America and the current trend in oilfield services, we believe Schlumberger is favorably positioned.
 
Apart from various organic means, the company has also been active on the inorganic front to continuously improve its product and technology portfolio. In March, Schlumberger purchased Nexus Geosciences Inc, a Houston-based provider of integrated seismic software and services for rapid imaging, modeling and interpretation. Immediately after this, the company also purchased Geoservices, a French oilfield services company that specializes in mud logging and production surveillance operations.
 
With the recent growth in exploration activity, particularly in deepwater Iraq and Russia, the company will benefit from its product and technology portfolio and low-cost provider position. We currently have a Neutral recommendation for Schlumberger shares.
Read the full analyst report on “SLB”
Zacks Investment Research