Email of the day (1)
Comment of the Day

March 15 2010

Commentary by Eoin Treacy

Email of the day (1)

on shale gas and water treatment
"It's been a while since I have sent any comments and actually terminated my subscription a few months back only to have FM withdrawal symptoms that led me to signing up again. Really, it's an educational experience that I appreciate greatly. On the discussion about shale gas and water contamination I notice that one of the leading oilfield service companies (Schlumberger) has its own water management service so for sure will be providing the technology to deal with these environmental issues as they arise. Indeed, one massive growth segment in the Oil & Gas industry is not only in the demand for energy but also in the environmental area minimizing and treating wastes generated in the drilling, production and refining process. Interestingly, as regards the recently announced acquisition of Smith International by Schlumberger you will find the leading global provider of environmental solutions to the industry inside the Smith group............a company called MISWACO jointly owned by Smith and SLB. Combining these two and you have a company not only in a position to profit from the increase in shale gas hydraulic fracturing but one who will be positioned as the leading environmental and water management company in the world."

Eoin Treacy's view Welcome back and thank you for another insightful email which I'm sure will be of interest to subscribers. We agree that water management is likely to benefit enormously from the expansion of nonconventional drilling and Schlumberger is a key share in this sector.

Schlumberger's price appears to be absorbing the Smith acquisition with relative ease. It found support in the region of the 200-day moving average near $60 three weeks ago and continues to rally. A sustained move below the recent low would be required to question scope for continued higher to lateral ranging.

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