OneSubsea, operated by oil drilling equipment maker Cameron International Corporation (CAM) and oilfield services provider Schlumberger Limited (SLB) has secured a subsea production systems contract from the Mexican state-owned petroleum company, Pemex.
The deal, with a value of over $290 million, involves development of the Lakach deepwater project, located off the coast of Mexico. This is Permex’s first deepwater subsea field development project.
Apart from supplying subsea equipment and tooling for the seven-well system, OneSubsea will offer installation and commissioning services. Supply of the above-mentioned equipment will expectedly start from the middle of 2016.
Cameron International is a leading manufacturer of pressure control equipment used in onshore, offshore and subsea applications for oil and gas drilling, production and transmission. The company has a diversified product portfolio, specialty service capabilities and proprietary technological expertise.
Schlumberger is a premier oilfield services company that provides technology, project management and information services to the global oil and gas industry. The company has a strong balance sheet, technological expertise and an efficient management team that will prove beneficial in the long term.
OneSubsea, capitalizing on the strengths of both Cameron and Schlumberger, offers leading subsea solutions.
However, the profitability of both these firms is directly linked to oil and gas prices, which are currently under pressure. Notably, the current quarter and current year estimates for both Cameron and Schlumberger have seen negative estimate revisions of late, suggesting a bearish stand on the stocks.
Houston, TX-based Cameron and Schlumberger both have a Zacks Rank #3 (Hold), implying that they are expected to perform in line with the broader U.S. market in the next one to three months.
Meanwhile, one could consider better-ranked players from the broader energy sector like Helix Energy Solutions Group, Inc. (HLX) and Pioneer Energy Services Corp. (PES), both of which sport a Zacks Rank #1 (Strong Buy).
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