Weatherford and Schlumberger have entered an agreement to form OneStim, a joint venture (JV) that will provide completions products and services to develop unconventional resources in the US and Canada.
The JV is expected to offer a diverse multi-stage completions portfolio with one of the largest hydraulic fracturing fleets in the industry.
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Schlumberger and Weatherford will have 70:30 ownership in this newly formed JV respectively.
Schlumberger chairman and CEO Paal Kibsgaard said: “The joint venture creates a new industry leader in terms of hydraulic horsepower and multistage completions technologies in North America, which through its scale offers a cost-effective and highly competitive service delivery platform.
“OneStim is uniquely positioned to provide customers with leading operational efficiency and best-in-class hydraulic fracturing and completions technologies, while at the same time significantly improving full-cycle shareholder returns from this market.”
Under the agreement, Weatherford will provide its multi-stage completions portfolio, cost-effective regional manufacturing capability and supply chain towards the joint venture.
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By GlobalDataSchlumberger will be responsible for providing surface and downhole technologies, operational processes and advanced geo-engineered workflows.
Both companies have also agreed to contribute their respective North American land hydraulic fracturing pressure pumping assets, multi-stage completions and pump-down perforating businesses.
Weatherford chairman William Macaulay said: “The OneStim joint venture creates a leading unconventional products and services provider in North America.
“This transaction will allow Weatherford to deleverage its balance sheet while retaining a significant exposure to the unconventional market.
“This transaction was unanimously approved by the Board of Directors and will create significant value for both parties.”
The transaction is subject to customary closing conditions and regulatory approvals and expected to close in the second half of this year.
Under this transaction, Weatherford will receive a single $535m cash payment from Schlumberger, which will manage the JV and consolidate it for financial reporting purposes.
