Halliburton: Great Opportunity in Global Shales

The chief executive of oilfield services giant Halliburton says there are "fantastic and phenomenal opportunities" to expand shale drilling beyond North America, but that growth may come slowly.

"There is a lot to be excited about in the shale plays, but there are obstacles that need to be overcome and that's good because I don't think the industry today could serve a number of increasing shale plays outside the U.S.," David Lesar commented during a webcast presentation.

Pressure pumping has leap-frogged land drilling, offshore construction and offshore drilling in the last ten years to become the largest segment of the oilfield services industry.

Lesar said that demand for pressure pumping, which enables producers to crack open shales to release oil and gas, has outstripped Halliburton and its competitors' ability to provide the service.

While North America holds an estimated 15% of worldwide shale reserves, it has about 80% of global pressure pumping capacity.

"Even then we cannot keep up with the demand," Lesar said. "The challenge is going to be getting ramped up to address the shale opportunities outside the U.S."

Lesar said Australia, Poland and Argentina each have great potential for significant shale development, but that Australia is the only market that currently has the necessary geology, regulatory environment, pricing and infrastructure.

Poland, he said, is lacking in oilfield infrastructure and in Argentina, where Halliburton recently completed South America's first shale well for Apache Corp., government regulated natural gas prices are too low.

"Shale gas could develop very quickly in Argentina, but only at the right price and we're not there yet," Lesar said.

Read our Three Part Series:

Recent Trends in the North American Pressure Pumping Market Have Serious Implications for Domestic and International Operators and Suppliers

Read Part One of this Series HERE Part Two HERE Part Three HERE