Schlumberger advised that its crisis management team has been activated as the oil services company implements its downturn playbook in response to the impact of the COVID-19 pandemic oil prices and it operations. The company said it is cutting capital expenditures (capex) by up to 30% from 2019 levels, with almost all of its capex allocated to international markets, as more than 80% of free cash flow is generated internationally. The company said its international and Cameron operations are starting to be impacted by the COVID-19 disruption and its North America land operations are being impacted by the oil price correction, while its China manufacturing operations and supply chain are recovering to pre-crisis levels. For the second quarter, Schlumberger expects a rapid reduction in rig count and completions activity in North America, with rig counts projected to reach 2016 trough levels. For international, the company is planning for reduced activity as customers cut budgets, but the extent of the reductions are uncertain. Schlumberger also said it was accelerating land restructure and personnel and pay reductions in North America.
(Source: Schlumberger/Market Watch)