WRAPUP 1-Oil service firms talk cash plans as market calms

* Halliburton says may buy back shares in 2010

* Transocean talks of internal debate over cash plans

* Cameron seeks first to invest in business, then M&A

* Transocean shares down 2 pct, Halliburton down 1.4 pct

By Braden Reddall

SAN FRANCISCO, Feb 3 (BestGrowthStock) – While nobody in oilfield
services wants to sound the all clear for an industry floored
last year by a collapse in drilling, companies are now more
comfortable with their cash positions — and ready to spend.

Acquisitions of smaller specialist companies are on
everyone’s radar screens, but many investors, after enduring a
year of austerity, seem hungry to reap rewards for their
patience.

Halliburton Co (HAL.N: ), the second-largest oilfield
services company, said it may return some of its $2 billion in
excess cash to shareholders this year. [ID:nN03153707]

“We may recommence buying our shares back,” Chief Financial
Officer Mark McCollum said on Wednesday at the Credit Suisse
Energy Summit in Vail, Colorado, noting the company would first
need to see more improvement in financial markets.

One key measure of sentiment for the industry is U.S. crude
oil prices (CLc1: ), which have doubled in less than a year.

The change is palpable for those that sell energy companies
the tools they need to extract oil and gas. Transocean Ltd
(RIG.N: ) is looking forward to more steady earnings,
particularly from its deepwater rigs, according to Ricardo
Rosa, who became its chief financial officer last September.

Saying ultra-deepwater remained the “bright light on its
horizon,” Rosa also mentioned in his presentation to the Credit
Suisse conference the internal debate going on over what to do
with the company’s cash flow in the coming years.

Shares of Transocean fell 1.9 percent to $87.44 on the New
York Stock Exchange, compared with a 0.53 percent drop in the
Philadelphia Stock Exchange oil service index (.OSX: ).

There has been growing speculation on Wall Street about
what the world’s largest offshore drilling contractor would do
with its free cash flow.

“It is our view that RIG could rather easily institute a
recurring quarterly dividend of $1 per share,” Simmons & Co
analysts wrote in a note to investors last week.

Such a move would follow the $1-per-share special dividend
paid in December by oilfield equipment company National Oilwell
Varco Inc (NOV.N: ), which posted quarterly results on Wednesday
and reiterated its appetite for acquisitions. [ID:nN03117310]

Returning cash to shareholders, however, does not top the
list of priorities for Cameron International Corp (CAM.N: ), a
mid-sized oilfield services and equipment company that reports
fourth-quarter results next Tuesday.

“Cameron generates a lot of cash — the challenge is how we
deploy that cash,” Chief Financial Officer Charles Sledge told
the conference, adding that its first priority was investing in
its business, while the second was acquisitions.

Shares of Cameron closed 0.2 percent higher at $39.68,
while Halliburton was 1.3 percent weaker at $30.36.

Growth Stocks

(Reporting by Anna Driver in Houston and Braden Reddall in San
Francisco; Editing by Gary Hill)

WRAPUP 1-Oil service firms talk cash plans as market calms