Schlumberger exits vessel market, large impairment of library
Following market chatter in recent years, Schlumberger has announced that it will be exiting the seismic vessel market. While the company did not provide further information on the exit strategy, we believe that some of the newer vessels will end up in another set-up, possibly with Schlumberger guaranteeing for some utilisation for its multi-client division. These vessels have been absent from the contract market in the past few years and in a new set-up this could result in a return to the contract market. WesternGeco also announced an USD246m impairment on its library, reducing its book value by 25%. For companies like TGS and Spectrum trading at 2.3x and 1.7x book value, we consider this a warning sign on valuation.Petroleum Geo-Services is engaged in providing geophysical services and oil and gas production services. As of Dec. 31, 2001, Co. operated six Ramform design vessels in its marine seismic data acquisition operations.
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