Schlumberger Limited (NYSE:SLB) the largest oil field service provider of the world has employed the services of Helge Lund on its board. Mr. Lund before the appointment was the CEO of the BG Group plc which was recently acquired by Royal Dutch Shell plc. (ADR) (NYSE:RDS.A).
The oil and gas industry is going through a rough period at the moment. Oil field service providers were the ones to be the most impacted by the massive crude oil price rout as they first come in line. Oil and gas exploration and production companies mainly depend on oil field service providers for exploration. But the recent cuts in capital spending mean that demand for such services have fallen sharply.
On Friday, crude oil prices closed in the red yet once again. The US benchmark for crude oil, West Texas Intermediate (WTI) closed down 2.95% at $49.07 per barrel while the global benchmark for crude oil, Brent Crude closed down at 2.71% at $50.54 per barrel.
The fundamentals surrounding the oil industry despite the recent gains aren’t that encouraging for oil companies. Schlumberger thus through the services of Mr. Lund would be hoping to reap the most out of the massive experience he holds. The largest oil service provider has also engaged in a merger with Cameron International. Schlumberger has long argued that oil services have done little to improve their performance and is therefore investing a lot in technology to help bring oil companies to that level.
Mr. Lund has loads of experience when it comes to the oil and gas industry. Before BG, Mr. Lund worked at Statoil for over a decade. When he came to BG the company was going through a lot of inefficiencies. However, Mr. Lund was praised for turning things around at the company.
Like other oil field services, Schlumberger has come under a lot of fire for laying off workers. Since the downward trend in crude oil prices started the company has managed to cut around 28% of its workforce or in other words 36000 employees. While at the same time top notch executives were given attractive salaries. Mr. Lund’s lucrative salary has also been a subject of numerous dramas at BG.
As reported by the Wall Street Journal, Mr. Lund is expected to stay as director of board till its next annual general meeting.