Schlumberger: To Exit Land, Marine Seismic Acquisition Business
Oil-services giant Schlumberger Ltd. (SLB) said it will exit the marine and land seismic acquisition market and transform its WesternGeco product line into an asset-light business over concerns about future returns.
Seismic acquisition involves generating and recording data about the composition of rocks or fluid content deep underground. Schlumberger recorded a $198 million impairment charge on its seismic data operation in the third quarter.
WesternGeco is a part of the company’s Reservoir Characterization Group, where fourth-quarter revenue declined 8% sequentially and 2% from the prior year.
“The only product line that does not meet our return expectations going forward, even factoring in an eventual market recovery, is our seismic acquisition business,” Chief Executive Paal Kibsgaard said.
Shares fell 2.2% to $74.68 during premarket trading. The stock is down 12% over the past 12 months.