LONDON (ShareCast) - (ShareCast News) - Oil services companies Schlumberger and Weatherford announced an agreement on Monday to create OneStim - a joint venture to deliver completions products and services for the development of unconventional resource plays in the United States and Canada land markets.
The two firms said the joint venture would offer one of the broadest multistage completions portfolios in the market, combined with one of the largest hydraulic fracturing fleets in the industry.

Weatherford will contribute its multistage completions portfolio, regional manufacturing capability, and supply chain, while Schlumberger will provide the joint venture with access to its surface and downhole technologies, operational processes and geo-engineered workflows.

Schlumberger and Weatherford will have 70/30 ownership of the joint venture, respectively.

The transaction was expected to close in the second half of 2017, and remained subject to regulatory approvals and other customary closing conditions.

Under the terms of the formation agreement, Schlumberger and Weatherford will contribute all their respective North America land hydraulic fracturing pressure pumping assets, multistage completions, and pump-down perforating businesses.

Weatherford will also receive a one-time $535m cash payment from Schlumberger, which will manage the joint venture and consolidate it for financial reporting purposes.

"The joint-venture creates a new industry leader in terms of hydraulic horsepower and multistage completions technologies in North America land, which through its scale offers a cost-effective and highly competitive service delivery platform," said Schlumberger chairman and CEO Paal Kibsgaard.

"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."

Weatherford chairman William Macaulay said the OneStim joint venture created a "leading" unconventional products and services provider in North America land.

"This transaction will allow Weatherford to deleverage its balance sheet while retaining a significant exposure to the unconventional market," he explained.

"This transaction was unanimously approved by the board of directors and will create significant value for both parties."

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