Plummeting Oil Prices Create Near-Term Uncertainty on NCS

Plunging oil prices are creating near-term uncertainty in exploration spending. This is having an impact on service companies and seismic surveyors active in Norway.

‘Near-term uncertainty in exploration spending has been increased by a negative oil price development with the price of Brent dropping close to 25% during the last four months. While it is still too early to conclude how this trend will impact seismic spending, it is likely that energy companies will continue their efforts to reduce capital expenditures and become more selective when prioritizing investments such as seismic programs,’ reads the third quarter results released by Norway-based TGS. 

TGS reported consolidated net revenues at $190 million, compared to $191 million in Q3 2013.

‘Net late sales totalled USD 130 million, down 6% from USD 138 million in Q3 2013.’

Despite this near-term uncertainty, the company does not see bleak long-term prospects. 

‘TGS believes the long-term future of its business and particularly the Company’s focused asset light multi-client model is strong.’