Schlumberger reaffirms commitment to Venezuela despite debt concerns

Oilfield services provider Schlumberger has released a statement saying that operations in Venezuela have improved enough for it to recognise all revenue associated with its first quarter operations.

The announcement comes two weeks after the group said it was suffering collection issues in the country and announced plans to reduce activity on a temporary basis.

The company has had problems with the PDVSA [Petrleos de Venezuela/Petrol of Venezuela], the country's state-operated oil giant, over huge debts said to total hundreds of millions of dollars.

Speaking on March 22nd, Rafael Ramirez, Venezuela's Oil Minister, revealed that last year PDVSA's debts to its service providers, including Schlumberger, had rocketed 35% above the $12bn posted the previous year.

The minister is also quoted as saying that during a "very good meeting" with the head of Schlumberger, they "clarified all of the issues".

On Tuesday, Chief Executive Officer, Paal Kibsgaard, released a statement saying: "In Venezuela, after meetings with PDVSA, the collections have improved to the point that we will recognise all revenue associated with our first-quarter operations.

"We further expect to finalise a new payment agreement with PDVSA and we anticipate ramping up activity to meet the current and future needs of PDVSA's development and production plans, thereby continuing our commitment to Venezuela."

Schlumberger's share price was unchanged at $75.23 at 10:00 on Tuesday.

MF