Baker Hughes said on Wednesday it had collected $5.716 billion in revenue in the first three months of 2023, down three percent from the final quarter of 2022, as orders fell five percent to $7.632 billion. quarterly dollars.
Lower industrial and energy technology (IET) sales volumes dragged down earnings in the January-March 2023 period, it said in a press release. However, the figure was up 18 percent compared to the same period last year, driven by a 12 percent year-on-year increase in orders.
Baker Hughes’ oilfield services and equipment revenue totaled $3.577 billion, while its energy and industrial technology segment generated $2.138 billion in the first quarter of 2023. The Nasdaq-listed energy solutions provider received bookings for projects in Angola, Canada, Malaysia and Norway. , Qatar and the US during the quarter.
North America accounted for $992 million of revenue, down 4% from the October-December 2022 quarter. Contribution outside the region rose 1 percent driven by $661 million in revenue from the Americas Latin, but that was “partially offset by Middle East/Asia revenue.”
“While 2023 has already begun with some macro volatility, we remain bullish on the outlook for energy services and Baker Hughes,” the company’s chairman and CEO Lorenzo Simonelli said in the earnings report. “Our diverse portfolio includes both long-cycle and short-cycle businesses that position us well to navigate any period of variability that may occur in the energy sector.”
Baker Hughes announced during the period a memorandum of understanding with Fortescue Future Industries to jointly explore potential technology solutions for the geothermal, green ammonia and green hydrogen sectors.
Another agreement, with HIF Global, aims to develop technology to capture carbon dioxide directly from the atmosphere.
In a collaboration with Central Hidroeléctrica de Caldas and Ecopetrol also presented during the first quarter, Baker Hughes will participate in the studies prior to the project of a geothermal power plant in the Nereidas Valley in Colombia.
Change of industry to natural gas
In his outlook for the energy sector, Baker Hughes chief Simonelli pointed to a shift toward natural gas as the world moves to clean energy.
“We continue to believe that the current environment remains unique, with a spending cycle that is more durable and less sensitive to commodity price swings, relative to previous cycles. Another salient feature of this cycle is the continued shift to natural gas and LNG development,” he said.
“As the world increasingly recognizes the crucial role that natural gas will play in the energy transition, as a transition and destination fuel, the case for a multi-decade growth opportunity in gas is steadily improving as to transition and destination fuel”.
The International Energy Agency (IEA) said in its report on the gas market for 2022 that the supply shock in that year has put the spotlight on low-emission gases, including natural gas subject to to carbon capture solutions, as a compromise between energy security and decarbonisation.
“The global gas and energy crisis triggered by Russia’s invasion of Ukraine once again reminded the world of the importance of energy supply security and, in doing so, highlighted the need to accelerate clean energy transitions while reducing vulnerabilities from dependence on fossil fuel imports.” said
“Low-emission gases lie at the intersection of energy supply security and decarbonisation efforts: in addition to contributing to low-emission pathways, domestically produced low-emission gases improve market resilience and can significantly reduce dependence on fossil fuel imports”.
Policy responses to supply disruption have favored gases with lower emissions. The European Union developed the REPowerEU Plan that boosts the production of biomethane and hydrogen. The US passed the Inflation Reduction Act, which includes tax credits for new biogas and clean hydrogen plants, the IEA noted.
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