Sequentially, Reservoir Characterization revenue increased on strong WesternGeco multiclient sales in the US Gulf
of Mexico and the Angola GeoMarket, together with robust end-of-year Schlumberger Information Solutions (SIS)
software sales across all Areas. WesternGeco also improved with the resumption of land seismic activity in the Middle
East and new surveys in North Africa. Wireline reported considerable growth across all geographical Areas, and
particularly on stronger offshore exploration activities in the Nigeria & Gulf of Guinea, Southern & Eastern Africa and
Central & West Africa GeoMarkets. Drilling revenue increased on higher M-I SWACO activity in North America Land,
the US Gulf of Mexico and Latin America. IPM revenue increased significantly, mostly from projects in Mexico and Iraq,
while Drilling & Measurements revenue was higher on improved pricing and strong activity in the US Gulf of Mexico
and the Nigeria & Gulf of Guinea GeoMarket. Reservoir Production revenue increased, driven by stronger Completions
and Artificial Lift product sales across all Areas. In North America Land, Well Services grew through capacity additions
and continued improvements in asset utilization and crew efficiency. In addition, Framo and Schlumberger Production
Management (SPM) posted strong sequential increases.
On a geographical basis, North America Area revenue grew sequentially on increasing deepwater work in the US Gulf
of Mexico, higher rig count and land activity in the US and Canada, and significant WesternGeco multiclient sales. In
addition, Well Services reported considerable increases from additional fleet deployment and continued improvements
in asset utilization and crew efficiency. In the Latin America Area, strong revenue was recorded in the Mexico &
Central America GeoMarket from higher IPM project activities and SIS software sales; in the Venezuela, Trinidad &
Tobago GeoMarket from WesternGeco marine seismic activities; and in the Peru, Colombia & Ecuador GeoMarket from
robust Artificial Lift product sales. In the Europe/CIS/Africa Area, strong results were led by the Angola GeoMarket,
which saw vigorous WesternGeco multiclient sales in addition to expanded presalt offshore activity for Wireline,
Testing Services & Drilling & Measurements; the Nigeria & Gulf of Guinea GeoMarket, which recorded robust
Completions product sales and higher Drilling & Measurements and Wireline activity; and the North Africa GeoMarket
that reported higher Wireline, Testing Services, Well Services and IPM project activity. These increases, however, were
reduced by lower North Sea activity which was impacted by seasonal weather issues. In the Middle East & Asia Area,
strong Completions and Artificial Lift product sales and robust SIS software sales drove results—particularly in the
India GeoMarket. These results were augmented by continued growth in the Saudi Arabia, Bahrain GeoMarket due to
the rebound of land seismic acquisition, strong rigless activity and land rig additions. The Oman GeoMarket grew
primarily on higher Wireline and Artificial Lift activities while the Iraq GeoMarket saw an increase in non-project
services in addition to new IPM projects.
Pretax operating income of $2.17 billion increased 12% sequentially over prior quarter. Pretax operating margin
increased 82 basis points (bps) sequentially to 21.1% primarily due to the strong sales of WesternGeco multiclient
licenses, SIS software and Completions products. Drilling & Measurements and Wireline also contributed to this
sequential improvement through increasing higher-margin exploration activities.
Reservoir Characterization
Fourth-quarter revenue of $2.79 billion was 12% higher sequentially. Pretax operating income of $777 million was
28% higher compared to the third quarter of 2011.
WesternGeco and SIS posted significant sequential revenue growth on strong multiclient sales in the US Gulf of
Mexico and the Angola GeoMarket, and on robust software sales across all geographical Areas, respectively.
WesternGeco also improved on the resumption of land seismic activity in the Middle East and new surveys in North
Africa. Wireline recorded increases across all Areas led by stronger offshore exploration activities in the Nigeria & Gulf
of Guinea, Southern & Eastern Africa and Central & West Africa GeoMarkets. Data & Consulting Services and Testing
Services also posted gains.
Sequentially, pretax operating margins increased markedly by 340 bps to 27.9% through the seasonally strong sales
of WesternGeco multiclient licenses and SIS software. Increasing higher-margin Wireline exploration activities also
contributed to the growth.
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