Major oilfield service provider Halliburton Company (HAL) has entered into a long time deal with Petroamazonas, an Ecuador-based company involved in the exploration and development of the country’s oil reserves.
Per the agreement, Halliburton is expected to provide field development, project management, drilling and completions services to nine mature oil fields – including Victor Hugo Ruales, Palo Azul and Lago Agrio − for a period of 15 years. Halliburton added that the contract period can be extended for five more years.
During the first five years of the contract, Halliburton will likely invest $1 billion in enhancing oil recovery from the existing matured wells and also in the discovery of new hydrocarbon reserves.
Halliburton has been providing consulting and well-related services to the state-owned oil corporation in Ecuador for a length of time. The company believes that its groundbreaking technology for developing mature oil and gas fields will help Petroamazonas in recovering the remaining and bypassed reserves from the oil resources that were previously uneconomical.
Houston, TX-based Halliburton is an oilfield service provider in the world, offering a variety of equipment, maintenance, and engineering and construction services to the energy, industrial, and government sectors. The company operates under two main segments: Completion and Production, and Drilling and Evaluation.
Currently, Halliburton carries a Zacks Rank #4 (Sell), implying that it will underperform the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at better-ranked players in the same industry like Helix Energy Solutions Group Inc. (HLX), Newpark Resources Inc. (NR) and Basic Energy Services Inc. (BAS). Helix Energy and Newpark Resources sport a Zacks Rank #1 (Strong Buy), while Basic Energy Services carries a Zacks Rank #2 (Buy).
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