2
Demand for reservoir production technologies was boosted by growing deployment of the HiWAY* channel fracturing service in
unconventional and tight reservoir applications around the world. The service is part of a Schlumberger approach that achieves
more performance with less equipment and resources, and the 1,200 stages pumped in the first half of the year saved more than
60,000 tons of proppant compared with conventional operations.
A number of small technology-based acquisitions were completed during the year. These included the purchase of the remaining
equity interest in Framo Engineeering AS, a privately owned Norwegian company specializing in the sale and manufacture of
products and services related to multiphase pumps and subsea pump systems, multiphase metering systems, and swivel and marine
systems. Schlumberger also announced the purchase of ThruBit LLC, a company providing openhole logging services using a unique
through-the-bit deployment technique that offers a novel way of obtaining wireline logs in horizontal wells in shale plays.
In Integrated Project Management work, Schlumberger and Saxon Energy Services merged their respective land-based rig fleets,
resulting in Schlumberger rigs and crews operating in Oman, Pakistan, and Venezuela becoming part of Saxon’s operations. And
as part of a stronger focus on the growing production services enhancement market, Schlumberger Production Management was
formed to pursue opportunities in this sector.
Over the last four years, we have promoted Excellence in Execution. The ultimate measure of our success must be customer satis-
faction—one factor of which is the reduction in operational nonproductive time. In 2011, we reached an overall 40% reduction since
the program began. More specifically, the year saw a 9% fall year-on-year in spite of an 8% increase in activity. Increasing
activity stretches resources—both technical and human—and to achieve such an improvement is a strong result. The Excellence
in Execution program has also been of significant value in the successful mobilization of the high-profile projects that are central
to the new wave of exploration.
For 2012, projected GDP growth continued to be revised downwards during the fourth quarter as positive signs from the US and
Japan were offset by continued concerns over the Eurozone and the potential slowing of growth in China. In line with lower growth,
oil demand forecasts have also been revised downwards during the fourth quarter, although the increasing weight of the emerging
economies, the weakness of non-OPEC supply, and a number of geopolitical concerns have supported prices, which, absent a global
recession, are not expected to weaken significantly. For natural gas, little change is expected in the behavior of the main geograph-
ical markets in 2012. Against this backdrop, Schlumberger is planning for growth in 2012, while building significant flexibility into
resource investments.
I would once again like to thank our customers for their confidence and support, and our employees for their dedication and com-
mitment. We remain confident that any potential reductions in activity will be short-lived due to limited spare oil capacity and to
growing international demand for natural gas. Further, we believe our competitive position remains strong, given our strength in
the international markets in terms of global footprint and contract portfolio, and given the balance that we have established
between reservoir characterization, drilling, and production services in North America.
Paal Kibsgaard
Chief Executive Officer
