Oil investment boosts income of oil services companies
Oil survey service and data providers like TGS realize huge gains from oil sectors relying heavily on surveys.
TGS-NOPEC announced its bottom line figures for the year may reach above-target levels due to flourishing oil exploration activities especially in very remote areas of the globe.
TGS is generally a geoscience services and data provider with a huge database of digital oil well data which is also available online.
The company independently conducts seismic surveys on areas it chooses and looks for willing clients who need such data. The current boom in oil discovery projects has resulted to order backlogs which only mean that for TGS, business is brisk.
Analyst Joergen Andreas Lande says “These results are fantastic, on all levels.” He disclosed further that the company is very capable of doing surveys in the frontier areas, and that the rise companies choosing to invest in oil is certainly a boon for them.
The oil industry, including subsectors has actually benefited from the booming oil exploration which is seen to rise further as crude prices soar to $120 a barrel.
The hike in TGS’ traded shares reached a record high of above 7 percent versus 1.1 percent for its competitor, PGS. With more than 100 percent increase in order backlogs, TGS says prospects are indeed very bright.
Robert Hobbs, TGS chief executive announced that these opportunities allowed the company to ramp up investments. It hopes to end the year with over-the-target bottom line figures.
The company looks forward to oil explorations by the U.S. in the Gulf of Mexico area, and off the coast of Norway, as these developments mean more business.
Recently, it has gone into surveys of unconventional oil in North America. This year, it hopes to finish surveying shale liquid. Probing unconventional oil fields is one scope of work it will focus on in the coming years as oil firms continue to invest in oil exploration, especially in the frontier regions.
Its database of surveys has quickly expanded, and it will greatly depend on this wealth of information it has acquired through the years. For the first three months of 2012, income figures were up by more than 50 percent to almost $63 million. Initial projection was only for $49.3 million.
End-of-the-year projected income was up to $760 million, but as the requirement for more oil surveys grow, TGS sees earnings to rise up to $830 million level.