Baker Hughes independence is marked by solid set of results

Tuesday, 05 November 2019
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Industry is forecast to reach investments in 100 MTPA of new output by end of 2019

LNG Journal editor

Baker Hughes Co., the energy services provider and LNG equipment supplier, said it expected an increase in liquefied natural project activity as it posted solid third-quarter results and more contract wins since regaining its independence from General Electric.

Baker Hughes posted third-quarter revenues of $5.88 billion, an increase of 4 percent from the $5.66Bln in the year-ago quarter, and the results included a modest net profit.

Increase

The company reported third-quarter net profits of $57 million compared with $13M in the same three months of 2018 and a $9M loss in the second quarter of 2019.

Orders received in the quarter amounted to $7.8 billion, an increase from the 2018 quarter of 35 percent.

“We delivered a solid third quarter with strong growth in turbomachinery (for LNG) and Oilfield Equipment orders, and continued margin improvement in our Oilfield Services business,” said Lorenzo Simonelli, Baker Hughes Chairman and Chief Executive.

“Overall, we are very pleased with our execution as a team, and we believe Baker Hughes is firmly on the right path financially, operationally, and strategically,” stated Simonelli in reference to General Electric giving up its majority ownership and the company regaining the Baker Hughes name.

“In Oilfield Services (OFS), we continue to execute as the team drives operational improvements and wins commercially. Moving forward, we are increasingly focused on driving the next stage of margin improvement,” added the CEO.

Simonelli said that in the LNG-led Turbomachinery and Process Solutions division, order growth remained solid compared with 2018, driven by strength in LNG activity and resilient order activity in the non-LNG businesses.

“We have seen approximately 80 million tonnes per annum of new capacity reach final investment decisions since the fourth quarter of 2018, and the industry is on track to reach the 100 MTPA we outlined by the end of 2019,” said Simonelli.

Baker Hughes has already been awarded a contract and granted notice to proceed for Venture Global LNG’s Calcasieu Pass project in Louisiana.

The US-listed company with main offices in Houston and London will provide an LNG liquefaction train system with 18 modularized compression trains across nine “blocks” for a total nameplate capacity of 10 MTPA.

“As we look to the remainder of the year and into 2020, we believe we are well positioned for several large LNG projects still to come,” he stated.

The Baker Hughes OFS division also secured contract wins in key international markets in the quarter.

The company signed a large agreement with Saudi Aramco to provide completions, liner hangers, well intervention equipment and associated services for a number of key projects over the next five years.

OFE also won a contract to provide subsea trees, wellheads, and associated services for Apache’s UK North Sea development activities for the next three years.

Ichthys LNG

Also in the quarter, Inpex awarded OFE a subsea contract for its Ichthys LNG feed-gas field development, located off the northwest coast of Western Australia.

“Baker Hughes will deliver subsea production systems, including vertical trees, associated production control systems, distribution equipment, and topside controls,” it said.

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