UPDATE 2-Technip lifts forecast as oil companies invest

* 2010 revenue targets unchanged, operating target up

* 2011 subsea operating margins seen at around 15 pct

* CEO sees positive signs in Nigeria, Gulf of Mexico

(Recasts, adds CEO quotes and detail)

By Nina Sovich

PARIS, Oct 28 (BestGrowthStock) – French oilfield services company
Technip (TECF.PA: ) raised its outlook for 2010 on Thursday,
giving further evidence of an upturn in the oil services sector,
though it said it remained prudent for next year.

Progress on projects in Qatar, Ghana and Angola helped fuel
stronger-than-expected margins in the third quarter, while the
massive oil spill in the Gulf of Mexico earlier this year did
not have a negative impact on business, Technip said.

“New project momentum has grown in 2010 and some of it has
slipped into 2011,” Technip Chief Executive Thierry Pilenko said
on a conference call with analysts.

“There is still competition in the market…but oil price
stability and oil companies’ willingness to invest are good
drivers for next year.”

Technip said its 2010 subsea operating margin would be
around 16.5 percent, up from a previous forecast of 15 percent.
The onshore/offshore division margin would also be close to 6
percent, versus a previous forecast of around 5.3 percent.

The positive outlook follows results earlier this week from
Italy’s Saipem SpA (SPMI.MI: ), which said it could beat its 2010
targets on the strength of onshore activities.[ID:nLDE69Q1BD]

Schlumberger (SLB.N: ), the world’s largest oilfield services
company, also posted an increase in quarterly profit last Friday
on strength in U.S. and Canadian land drilling. [ID:nN22120005]

Technip has struggled in recent years with increased
competition in the Middle East from oil infrastructure companies
based in east Asia. Volatile oil prices and an uncertain economy
have also dampened oil majors’ enthusiasm for big projects.

The firm on Thursday reported a 4 percent fall in net income
for the third quarter to 103.4 million euros, above average
forecasts in a Reuters’ poll of 99 million. [ID:nWEA4983]


It also stuck by cautious guidance for 2011, saying
operating margins for subsea would be around 15 percent, lower
than the revised 2010 forecast, with onshore/offshore margins
predicted to remain stable year-on-year.

Finance head Julian Waldron said there was a “degree of
prudence” built into the earnings forecast for next year.

Despite the careful approach to 2011, the company appears to
have turned a corner. For the quarter, it posted an operating
margin of 10.3 percent, above expectations, and said its order
book reached 8.5 billion euros ($11.74 billion).

Technip also indicated that there were slivers of light in
regions blighted by instability and oil spills.

“As you know, the moratorium in the Gulf of Mexico was
raised in October. We see a transition period…difficulties in
getting permits. But despite this, visibility is improved in the
medium term,” Pilenko said on the conference call.

He also added that Nigerian gas projects appeared closer to

“Nigeria is gaining momentum. That’s new. Nigeria has been
pretty slow over the past four or five years,” said Pilenko.
(Additional reporting by Benjamin Mallet and Julien Ponthus;
editing by James Regan and Keiron Henderson)

UPDATE 2-Technip lifts forecast as oil companies invest