energy industry continues to be a solid consumer of heavy
equipment and expectations are for steady demand growth,
according to Caterpillar Inc. chairman and chief executive
officer Douglas R. Oberhelman.
power systems business includes customers in the oil and gas,
solar and turbine business, as well as marine and rail
equipment manufacturing, and the Peoria, Ill.-based
companys insights into the direction of such end markets
can be useful.
"The turbine business
has been fantastic for us the whole time weve owned it,
going back to the mid-1980s," Oberhelman said during the
companys earnings conference call with analysts. "But
with the oil and gas boom, the fracking boomaround this
country and elsewherethat has been a real stellar
performer the past few years, and I expect it to continue."
After visiting the
Eagle Ford shale in Texas, he said Caterpillars dealers
are more optimistic than he expected and they feel 2014 could
be another solid year.
"The fracking business
has changed the gas pipeline and gas compression business
immensely in this country, and theres still a lot of
build-out on getting that gas out of the ground. Ive got
to believe the opening in Mexico, when that starts, is going to
change the dynamics completely again," Oberhelman said,
referring to the Mexican governments reform of its energy
industry, including allowing foreign-owned companies to conduct
exploration and drilling, breaking the monopoly of state-owned
Petróleos Mexicanos SA de CV (Pemex).
Lukoil signed an agreement last week with Mexican President
Enrique Peña Nieto, making it possible to increase
deepwater exploration and production as well as extract shale
gas and oil.