Vallourec sees non-U.S. H2 tube orders increasing

Higher bookings in Europe, Africa, the Middle East and Asia will benefit Vallourec’s deliveries in the second half of 2018, according to company chairman Philippe Crouzet.

“Taking into account the gradual recovery in our main markets and the continued progress in our Transformation Plan, we confirm our positive outlook for the year with Ebitda in the second half of 2018 targeted to be significantly higher than in the first half,” Crouzet says in a report seen by Kallanish, sister publication of Kallanish Energy.

“International oil & gas markets are also showing positive signs of improving activity.” Vallourec’s improved performance in H1 was driven by positive momentum in the U.S. oil & gas market.

The Oil & Gas and Petrochemicals divisions’ revenue accounted for almost 70% of the company’s consolidated revenue in H1. Oil division revenue reached €1.11 billion ($1.29 billion), up 3.5% year-over-year, while Petrochemicals’ revenue rose 64.2%, to €179 million ($209.60 million).

In Europe, Africa, the Middle East and Asia, oil & gas volumes were up y-o-y, along with increased prices, notably in the Middle East and Southeast Asia. These were partly offset by a negative foreign exchange translation impact and a different product mix on some deliveries.

“Overall, tendering activity continues to increase in these regions as anticipated,” Vallourec says.

The higher demand for tubes (pipe) in North America registered by the company in H1 was supported by much higher drilling activity. The average active rig count in the U.S. rose by 23% y-o-y and OCTG prices were raised in the second half of 2017. Vallourec has, beginning in H2 2018, passed on significant OCTG price increases in the region, as planned.

Over the first half of 2018 the company recorded revenue of €1.84 billion ($2.15 billion), up 7.5% year-over-year, driven by the positive momentum in the oil & gas market. Ebitda stood at €18m, improving by €36 million y-o-y.

https://www.shaledirectories.com/blog/vallourec-sees-non-u-s-h2-tube-orders-increasing/