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Yahoo
2 days ago
- Business
- Yahoo
Chevron and Halliburton Unveil Next-Gen Hydraulic Fracturing
Chevron Corporation's CVX subsidiary, Chevron U.S.A. Inc., in strategic partnership with Halliburton Company HAL, a Houston, TX-based oil and gas equipment and services firm, has unveiled a revolutionary method for hydraulic fracturing through the integration of closed-loop, feedback-driven completions in Colorado's complex shale formations. The resulting efficiency, control and asset performance improvements represent a significant advancement in shale and tight rock production. The newly implemented intelligent fracturing process redefines traditional completion operations. CVX and HAL's collaboration delivers unprecedented precision by replacing manual intervention with machine-driven decision-making. The system executes each stage automatically, continuously adjusting to subsurface conditions based on real-time data feedback. This advancement marks a breakthrough in the Oils-Energy sector's digital evolution. Chevron's algorithmic integration of hydraulic fracturing expertise with Halliburton's robust digital platforms allows for continuous learning and adaptive optimization. The result is a process that not only reacts in real time but improves over time, thereby enhancing both safety and reservoir recovery. At the core of this autonomous system is Halliburton's ZEUS IQ intelligent fracturing platform, an advanced ecosystem that includes the OCTIV auto frac system and Sensori monitoring technology. Together, they create a dynamic closed-loop system, delivering actionable insights that guide stage-by-stage execution. These tools collect, analyze and respond to downhole pressure, flow rate and geomechanical feedback during the fracturing operation. The platform can adjust to the geological changes that occur during the job thanks to the OCTIV system's precise automation of hydraulic fracturing stages and Sensori's real-time subsurface feedback capture. This data-driven decision-making loop ensures optimal energy delivery into the formation, reducing waste and improving overall production efficiency. Chevron's deep domain knowledge in subsurface engineering and hydraulic fracturing plays a critical role in the success of this intelligent system. Their proprietary algorithm uses historical and real-time data to make split-second adjustments to the fracturing strategy. These automated decisions are made based on formation responsiveness, pressure anomalies and flow dynamics, rather than relying on static modeling or human prediction. This closed-loop automation allows for a far more accurate response to the complex, variable geology typical of shale reservoirs. Instead of following a fixed plan, the system adapts each stage based on current formation behavior, ensuring maximum reservoir contact and resource extraction. The collaboration between Chevron and Halliburton showcases a visionary fusion of digital infrastructure and field operations. By implementing a seamless link between cloud-based algorithms and field-level control systems, the partnership has enabled a model where innovation is rapidly deployed and tested at scale. Shawn Stasiuk, Halliburton's vice president of Production Enhancement, emphasized the importance of bringing the digital revolution directly to the wellsite. By embedding advanced intelligence into the fracturing process, the system enables operators to not only execute with precision but experiment and refine techniques in real time. This continuous innovation cycle promotes rapid gains in both efficiency and recovery. One of the critical benefits of the Chevron-Halliburton system is the reduction in execution variability. Traditional hydraulic fracturing operations are highly dependent on operator experience and judgment, leading to inconsistency between stages and wells. By contrast, this automated, algorithm-driven system delivers repeatable results, ensuring uniformity across completion operations. Moreover, the enhanced control functionality enables operators to intervene only when necessary, shifting the focus from real-time decision-making to strategic oversight. This shift empowers field teams to focus on high-value optimization, leaving the mechanical execution to the automated system. Chevron system's ability to dynamically adapt to the formation in real time brings a new level of intelligence to completion design. Rather than relying on predictive models or pre-job assumptions, the process evolves based on live subsurface data, providing unparalleled responsiveness. This adaptability translates directly to improved asset performance. By delivering energy more precisely into the formation, the system enhances fracture complexity, increases stimulated reservoir volume and maximizes hydrocarbon recovery. In regions like the Rockies, where geology can vary dramatically even within a single pad, this technology represents a transformative leap. Beyond technical performance, the closed-loop system offers tangible environmental benefits. By minimizing excess pumping, reducing fluid consumption and eliminating non-productive time, the process reduces the carbon footprint associated with well completions. Furthermore, the high degree of control results in more targeted stimulation, lowering the risk of unintended subsurface impacts. This approach aligns with Chevron's broader commitment to responsible energy production. As Kim McHugh, vice president of its Rockies Business Unit, noted, Chevron remains focused on advancing asset performance safely through a combination of technical innovation and strategic partnerships. The success of Chevron and Halliburton's closed-loop hydraulic fracturing process in Colorado could serve as a blueprint for global deployment in other unconventional plays. As automation becomes more deeply integrated into field operations, the industry may witness a paradigm shift in how wells are completed, optimized and monitored. This intelligent system's scalable architecture, cloud connectivity and machine learning capabilities position it as a frontrunner for widespread adoption across North America and beyond. Its ability to deliver repeatable, data-driven performance improvements will be essential as operators face increasingly complex reservoirs and greater expectations for environmental stewardship. The collaborative breakthrough between Chevron and Halliburton marks a key moment in the evolution of hydraulic fracturing. By merging automated execution with real-time subsurface feedback, they have created a system that operates with precision, consistency and adaptability that surpasses traditional methods. This closed-loop, intelligent fracturing approach is not only optimizing current operations but reshaping the future of completions. As the industry moves forward, such innovations will be central to unlocking more energy, with greater environmental responsibility and operational control. Currently, CVX holds a Zacks Rank #5 (Strong Sell), while HAL has a Zacks Rank #4 (Sell). Investors interested in the energy sector might look at some better-ranked stocks like Subsea 7 SUBCY, which sports a Zacks Rank #1 (Strong Buy), and Paramount Resources Ltd. PRMRF, holding a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. Subsea 7 is valued at $5.72 billion. The company is a global leader in delivering offshore projects and services for the energy industry, specializing in subsea engineering, construction and installation. Headquartered in Luxembourg, Subsea 7 supports both the oil & gas and renewable energy sectors with integrated solutions, including subsea infrastructure, heavy lifting and life-of-field services. Paramount Resources is valued at $2.19 billion. It is a Calgary-based energy company engaged in the exploration and development of conventional and unconventional petroleum and natural gas reserves across Canada. Paramount Resources' key assets include significant holdings in the Duvernay, Montney, Muskwa and Besa River formations located in Alberta and northeast British Columbia. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Chevron Corporation (CVX) : Free Stock Analysis Report Halliburton Company (HAL) : Free Stock Analysis Report Subsea 7 SA (SUBCY) : Free Stock Analysis Report Paramount Resources Ltd. (PRMRF) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
23-04-2025
- Business
- Yahoo
Halliburton Co (HAL) Q1 2025 Earnings Call Highlights: Navigating Revenue Declines and ...
Total Revenue: $5.4 billion for Q1 2025, a decrease of 7% compared to Q1 2024. Adjusted Operating Margin: 14.5% for Q1 2025. International Revenue: $3.2 billion, a decrease of 2% year over year. North America Revenue: $2.2 billion, a 12% decrease year over year. Cash Flow from Operations: $377 million for Q1 2025. Free Cash Flow: $124 million for Q1 2025. Net Income per Diluted Share: Reported at $0.24; Adjusted at $0.60. Completion and Production Division Revenue: $3.1 billion, a decrease of 8% compared to Q1 2024. Drilling and Evaluation Division Revenue: $2.3 billion, a decrease of 6% compared to Q1 2024. Capital Expenditures: $302 million for Q1 2025. Share Repurchase: Approximately $250 million of common stock repurchased in Q1 2025. Pre-tax Charge: $356 million due to severance costs, asset impairments, and other items. Warning! GuruFocus has detected 4 Warning Signs with IVZ. Release Date: April 22, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Halliburton Co (NYSE:HAL) delivered total company revenue of $5.4 billion and an adjusted operating margin of 14.5% for the first quarter of 2025. The company generated $377 million of cash flow from operations and $124 million of free cash flow, while repurchasing approximately $250 million of its common stock. Halliburton Co (NYSE:HAL) won significant contracts, including work with Shell in Brazil and exploration projects in Suriname and West Africa, showcasing its strong value proposition and service quality. The ZEUS IQ closed-loop autonomous fracturing operation was successfully completed, highlighting Halliburton Co (NYSE:HAL)'s technological advancements in the North American market. The company expects to return at least $1.6 billion of cash to shareholders through buybacks and dividends in 2025, demonstrating a commitment to shareholder returns. International revenue decreased by 2% year over year, primarily due to lower activity in Mexico, which remains a challenging market with no immediate recovery in sight. North America revenue was down 12% compared to the first quarter of 2024, driven by lower stimulation activity and decreased completion tool sales. The company recognized a pretax charge of $356 million due to severance costs, asset impairments, and other items, impacting financial results. There is increased uncertainty in the market due to recent economic concerns and the faster-than-expected return of OPEC production, which could affect future performance. Tariff impacts are expected to affect margins, with an estimated $0.02 to $0.03 per share impact in the second quarter, and further clarity on the full-year impact is pending. Q: How do you view US activity for the rest of the year given the current commodity price environment, and what oil price would significantly change customer behavior? A: Jeffrey Miller, Chairman, President, and CEO, stated that customers are currently digesting recent changes in the market, including commodity prices and tariffs. He noted that activity in the 60s range could impact production if it slows down significantly. The market is not building new equipment, which is a positive sign, and any decline in activity is quickly underpinned by its impact on production. Q: Can you provide an update on the situation in Mexico and its impact on margins? A: Jeffrey Miller explained that the situation in Mexico remains unsettled, with no immediate recovery expected. The new administration and Pemex are working through their plans, but significant decline rates in the market are expected to drive recovery eventually. However, the timing of this recovery is uncertain. Q: What is the outlook for Saudi Arabia within Halliburton's portfolio, and how does it fit into the flat international outlook for the year? A: Jeffrey Miller highlighted Saudi Arabia as a significant market with expected growth in 2025. He mentioned exciting opportunities, including tenders for Jafurah and other projects, where Halliburton's technology and growth engines, such as unconventional intervention and artificial lift, are expected to perform well. Q: How do you view the margin progression for the rest of the year, especially considering the white space in North America? A: Eric Carre, CFO, explained that Q2 margins are expected to be impacted by tariffs, mobilization costs, and a mix issue with software sales. However, he anticipates that margins in the second half of 2025 will be in the same range as 2024, driven by growth in international markets and the performance of growth engines. Q: Can you elaborate on the impact of tariffs and how you plan to mitigate them? A: Eric Carre stated that the tariff impact is expected to be $0.02 to $0.03 per share in Q2, with 60% affecting the Completion and Production division and 40% the Drilling and Evaluation division. Halliburton is working on mitigating the impact through a diversified supply chain and other levers, but more clarity is needed to fully understand the overall impact. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
