HOUSTON - SLB (NYSE: SLB), a global technology company, has secured three contracts from Brazilian state-run oil firm Petrobras (NYSE: PBR) to supply completion hardware and services for up to 35 subsea wells at the Buzios Wave II offshore oilfield.
The contracts were announced today, marking a step toward Petrobras's goal of electrifying its production systems to enhance reliability and production availability.
The technology involved in the deal, including full bore electric interval control valves and electric subsurface safety valves, was developed at SLB’s Taubaté Engineering Center in Brazil, in collaboration with CENPES, Petrobras's research center, and TotalEnergies (EPA:TTEF). This collaboration underscores the push for advanced solutions tailored to the challenges of the Brazilian pre-salt reservoirs.
Steve Gassen, President of Production Systems at SLB, stated that this contract award is a critical milestone for Petrobras as they transition to digitally integrated offshore electric production systems.
The move to electric completions is expected to allow Petrobras to control a more sophisticated system in the subsurface, which could lead to fewer wells needed and reduced heavy workovers throughout the productive life of the Buzios field wells.
The shift towards electric and digital-ready completions is part of a broader trend in the oil and gas industry towards increased efficiency and recovery rates, particularly in complex reservoirs. This contract signifies Petrobras's commitment to improving its field recovery efficiency through the adoption of new technologies.
While the press release contains forward-looking statements regarding the anticipated benefits of the technology and partnerships, these are subject to various uncertainties, including regulatory approvals and the actual performance of the technology in the field.
The financial details of the contracts were not disclosed in the press release. This announcement is based on a press release statement, and it should be noted that forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected.
InvestingPro Insights
As SLB (NYSE: SLB) forges ahead with its new contracts for the Buzios Wave II offshore oilfield, investors and industry watchers are paying close attention to the company's financial health and market performance. According to InvestingPro data, SLB boasts a robust market capitalization of $74.33 billion, reflecting its significant presence in the industry.
The company's Price-to-Earnings (P/E) ratio stands at a competitive 17.6, aligning with the InvestingPro Tip that the stock is trading at a low P/E ratio relative to near-term earnings growth. This could be an indicator of potential value for investors seeking to capitalize on the company's growth prospects.
Another key metric for SLB is its revenue growth over the last twelve months as of Q4 2023, which has been reported at an impressive 17.96%. This growth supports the company's strategic moves, such as the recent contracts with Petrobras, and underscores its ability to expand its operations effectively.
Moreover, SLB has successfully maintained dividend payments for 54 consecutive years, a testament to its financial stability and commitment to shareholder returns, as highlighted by another InvestingPro Tip.
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