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Halliburton expects Latin America rebound in 2015

Halliburton expects Latin America rebound in 2015

Posted by Juan Gavasa on October 21, 2014

"Even with better revenue in the third quarter, margins and overall activity levels still do not meet my expectations, due primarily to continued operational delays in Mexico," Lesar said.

However, Halliburton is well positioned to growth next year, he added while highlighting operations in Mexico, Brazil and Ecuador.

"First, we are up and running on our integrated projects in Mexico and expect to be at full operational capacity in early 2015," Lesar said. "We're also excited about the pace of Mexico energy reform and expect to see strong opportunities in Mexico shale, mature fields and deepwater markets in the coming years."

Halliburton is currently negotiating the retender of a directional-drilling contract with Brazil state oil firm Petrobras and expects to be operating under a new more profitable contract during the transition to 1Q15.

"And last but not least, we're very excited about our recent multi-billion dollar award in Ecuador where we expect strong growth as these projects ramp up next year. So for Latin America I expect a much stronger 2015 and we're well positioned for tremendous growth potential in the coming years," the CEO said.

Looking globally, Lesar said the recent drop in international oil prices would be short term. "Considering North America and OPEC production expectations, the continued tightness in global spare production capacity and potential geopolitical impacts on non-OPEC production, we believe that supply and demand will essentially be back in balance in a relatively short period of time."

THIRD QUARTER RESULTS

Halliburton posted attributable net income of US$1.203bn in 3Q14, up from US$706mn in the same quarter last year. Revenue rose to US$8.701bn from US$7.472bn and consisted of US$5.42bn in completion and production revenue and US$3.281bn in drilling and evaluation revenue, according to the firm's third quarter unaudited financial report.

In the same period Halliburton's Latin America revenue totaled US$1.045bn, up from US$1.002bn, and consisted of US$435mn of completion and drilling revenue and US$610mn of drilling and evaluation revenue.

"Mexico was the primary driver where we saw the benefit of higher activity on our Humapa project and recent contract approvals, which resulted in an increase in consulting and software revenue for the quarter," CFO Mark McCollum said.

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