Even though the energy industry is submerged with cost cutting efforts, it does appear that many companies are still investing in new technologies that could help improve drilling. Halliburton executives recently discussed the topic at a conference that took place this week. Even with the current state of the industry, Halliburton has seen a growing interest in their oil field services and the newer technologies they utilize. The president and chief health, safety and environment officer of Halliburton, Jeff Miller, was speaking on this topic at the Barclay CEO Energy-Power Conference on Tuesday.
While at the conference in New York City, Miller went on to address how technologies and tools are being used to locate and focus on the best locations to obtain oil from reservoirs. For the past several years, Halliburton has made it their focus to becoming more efficient when it comes to the amount of time it takes to drill the wells and manage other logistics. Even before the downturn the company had already developed a pump that was designed to be more efficient by cutting maintenance costs up to 40 percent. Miller said that these new pumps are currently replacing past models. He believes that the industry as a whole should incorporate such technologies to cut costs. He went on to say that efficiency can help costs, but it also benefits the entire draining process. He was quoted saying, “the reality is we’re only draining a part of the reservoir,” he said. “That may be good enough at $70 or $80 a barrel, but in the lower crude environment, we believe that success over the long-term means making better wells.” However, Halliburton customers are still not impressed with prices and eager to see more profound discounts.
Furthermore, it is important to remember that Halliburton is not immune to revenue declines that its competition is facing. The company is constantly considering what strategies they can use in order to cut costs. Halliburton’s chief financial officer is the first one to recognize the need to cut costs whenever possible. While cutting costs, the company is still looking towards the future. The deal to acquire Baker Hughes is evidence of Halliburton’s investment in long-term market domination. Miller has a strong belief that North America will be well positioned when the industry sees a comeback in 2017.
The merger, which their CFO stated is still in motion, is a big part of that recovery. Halliburton’s shareholders have recognized the need for such a merger and have approved the acquisition. The next step is to have it approved by federal regulators. Executives of the company have stated that they have no reason not to believe that the agreement would be finished by the end of 2015. The merger would combine the best part of both companies and increase efficiencies for all of their customers according to Miller and his executive team.