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The petroleum industry has not been spooked so far by a five-month slump in oil prices.
Halliburton Co., a key provider of oil industry services, revealed that in the third quarter of this year, its profit increased 26% as drilling activities continue to rise in the United States.
The Houston-based company is the first major player in the industry to report third-quarter results.
According to Halliburton, the number of drilling projects, from the second to third quarter, rose to 6% in the U.S., especially the rich underground shale deposits like those in the Eagle Ford region of Texas and the Bakken region in Montana and North Dakota.
New technologies gave the companies the ability to cheaply extract oil and natural gas from those fields, igniting a rush to drill despite the 24% drop in the benchmark price of crude since May.
According to Dave Lesar, CEO of Halliburton, oil companies may cut back in the long run but he added that he does not see “any meaningful changes” in the industry at present.
He also said, “I continue to believe in the long-term prospects for our business.”
Three years ago, the drop in oil and natural gas prices forced a lot of companies to scale back on their drilling projects. The number of rigs in operation dropped by more than half as gas lost around two-thirds of its value from July of 2008 to July 2009. During this period, oil prices also dropped from $147 to $61 per barrel.
Lesar said that this time will be different. Big oil players like Chevron, Royal Dutch Shell and Exxon, in the past three years have become increasingly involved in the oil and gas field in America. They usually do not change course just because of a short-term fluctuation of oil prices.