Schlumberger Ltd., the world's largest oilfield services provider, will stop taking new field management contracts, which have been criticized for their heavy upfront investment, while it seeks to sell off some existing deals, its CEO said March 25.

CEO Paal Kibsgaard, speaking at the Scotia Howard Weil energy conference in New Orleans, said the business known as Schlumberger Production Management (SPM), was cash-flow neutral last year and was expected to generate free cash flow beginning this year.

The company said last year it hoped to sell some of its SPM investments to recoup its costs. The business was formed in 2011 to help to diversify its equipment and services sales.

Schlumberger continues to offer stakes in existing projects "to clearly demonstrate the value of the SPM business model to our investors," said Kibsgaard. "In the meantime, we will not undertake any new SPM projects."

In the past, Kibsgaard insisted the business was strong and offered the potential for higher margins by allowing Schlumberger to choose all the equipment and services instead of the project operator.

Schlumberger has spent billions of dollars to take over managing customers' oil fields, in some cases becoming an investor in the fields, while seeking to profit from increased oil production. Critics say the ventures require heavy upfront investments and subject Schlumberger to commodity price risks.

The company reduced its investments in SPM projects to $981 million last year from $1.67 billion in 2017. It does not disclose results from the business but said SPMs accounted for less than 5% of $32.8 billion in revenue last year.

Kibsgaard also said he sees signs that oil and gas producers' investment views were "starting to normalize" after deep cuts in projects earlier this decade. However, North American spending growth faced a slowdown.

Onshore exploration and production investment in North America will decline more than 10% this year from last year, he said. Shale producers, which have driven U.S. oil production to record levels, face growing technical challenges as drilling moves to less productive areas, he said.

Kibsgaard also forecast "high single-digit [in percentage terms], year-over-year revenue growth" in its international markets this year. He said higher investments expected in Mexico, Angola, Indonesia and China would help drive new exploration.

The Houston-based company began formalizing its CEO succession plan last month, naming Olivier Le Peuch as COO. Investors have been frustrated over Schlumberger's strategic direction and hope succession planning could shift the company's focus, one analyst said.

The appointment came after Schlumberger's shares fell about 46% last year. The stock dipped 0.7% to $42.16 on March 25.