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Chairman and Chief Executive Officer of National Oilwell Varco (NOV) Explains His Strategy: What Does Pad Drilling Efficiencies Mean For His Rig Business?

67 WALL STREET, New York - January 15, 2014 - The Wall Street Transcript has just published its Oil & Gas: Drilling Equipment and Services Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Oil Price Expectations - Shale, Offshore and Deepwater Drilling - Unconventional Resources - Bundled Oil and Gas Services - Oil and Gas Transportation Services - Dividend Yields for Energy Investors - Domestic Crude Prices - International Energy Opportunities

Companies include: National Oilwell Varco, Incorp (NOV)

In the following excerpt from the Oil & Gas: Drilling Equipment and Services Report, the CEO of NOV discusses the outlook for his company for investors:

TWST: On your last earnings call you talked about North American E&Ps evolving towards a more industrial efficiency-based approach, and you said on the call that is not 100% good news for you. Can you talk elaborate one that?

Mr. Miller: I think what we are really talking about right there is, as you do more pad drilling - and you're really kind of walking the rigs around on a pad - is really good for the industry because it's much more efficient. But the severity, or I would say the velocity, of using some of the products that we produce are really not necessarily always going to be there. If you work on drilling one well, we are providing a lot of things in that particular rig. If you are doing a lot of this pad drilling, that one rig is going to be moving around, and it's going to take over for what another couple of rigs could have done. So just by definition, the volume of the products that we sell will be reduced.

Now having said that I understand while it may be a little bit on the margin for us, it's really good for the industry because we are able to drill much more efficiently. So we actually are starting to look at things other than the rig count. We are starting to look at well count as we take a look at what that is going to mean for our business for the future.

TWST: What is happening in the macro environment and/or within your customers' businesses that you think could be catalysts for growth for National Oilwell Varco?

Mr. Miller: I think the biggest thing in the macro environment is really going to be the LNG exports from this country. I think you should take a look at some of the companies like Cheniere and others that have export permits to start in the 2015 time frame. If that happens, I think what that does is opens up an awful lot of opportunity to drill gas wells...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.