(Reuters) - Baker Hughes Inc BHI.N said on Tuesday it expects revenue from North America to rise in the current quarter from the first as oil producers drill more onshore wells, helping the oilfield service provider make up for a fall in demand in the Gulf of Mexico.
Oil producers are spending more on lucrative shale fields to take advantage of oil prices stabilizing at over $50 per barrel, while clamping down on expensive and time-consuming offshore projects.
“Activity growth in the U.S. onshore well construction product lines is forecast to more than offset the seasonal decline in Canada and ongoing activity reductions in the Gulf of Mexico,” Chief Financial Officer Kimberly Ross said in a post-earnings call.
Larger rival Halliburton Co (HAL.N) said on Monday oil producers were completing nearly as many wells as they were drilling, leading to revenue and margin growth in its completion and production unit.
Market leader Schlumberger (SLB.N) said on Friday that it was redeploying service capacity and technical support resources from the Gulf of Mexico to other markets.
Shares of Baker Hughes, which reported a bigger-than-expected loss on Tuesday, fell as much as 4.3 percent to $56.15, before paring losses to trade down marginally.
The company, which is being acquired by General Electric Co (GE.N), said quarterly revenue fell 15.3 percent to $2.26 billion in the first quarter ended March 31.
Analysts’ on average had expected revenue of $2.27 billion, according to Thomson Reuters I/B/E/S.
In contrast, Schlumberger’s (SLB.N) first quarter revenue rose 5.7 percent and Halliburton’s 1.9 percent.
Baker Hughes is much more exposed than Halliburton to international markets, where activity and pricing for oilfield services has remained persistently low.
About 31 percent of Baker Hughes’ total revenue comes from North America, with operations in the Gulf of Mexico account for 15 percent of its revenue from the region.
Net loss attributable to Baker Hughes narrowed to $129 million, or 30 cents per share, in the first quarter ended March 31, from $981 million, or $2.22 per share, a year earlier.
According to Thomson Reuters I/B/E/S, the company lost 24 cents per share, on an adjusted basis. Analysts’ on average had estimated a loss of 21 cents.
GE said last week the merger of its oil and gas business with Baker Hughes remained on track to close in mid-2017.
Up to Monday’s close, Baker Hughes shares had fallen 9.7 percent this year, compared to a 8.8 percent decline in globally-traded Brent crude prices LCOc1.
Reporting by Arathy S Nair in Bengaluru; Editing by Arun Koyyur