causing cracks in the target formation. Proppant, such as sand of a particular size, is mixed with the treatment fluid to
keep the cracks open when the treatment is complete. Future hydraulic fracturing-related legislation or regulations
could lead to operational delays and increased costs and, therefore, reduce demand for our pressure pumping services.
If such additional international, national or state legislation or regulations are enacted, it could adversely affect our
financial condition, results of operations and cash flows.
If we are unable to maintain technology leadership, this could adversely affect any competitive advantage we
hold.
If we are unable to continue to develop and produce competitive technology or deliver it to our clients in a timely
and cost-competitive manner in the various markets we serve, it could adversely affect our financial condition, results
of operations and cash flows.
Limitations on our ability to protect our intellectual property rights, including our trade secrets, could cause a
loss in revenue and any competitive advantage we hold.
Some of our products or services, and the processes we use to produce or provide them, have been granted patent
protection, have patent applications pending or are trade secrets. Our business may be adversely affected if our patents
are unenforceable, the claims allowed under our patents are not sufficient to protect our technology, our patent
applications are denied, or our trade secrets are not adequately protected. Our competitors may be able to develop
technology independently that is similar to ours without infringing on our patents or gaining access to our trade
secrets, which could adversely affect our financial condition, results of operations and cash flows.
We may be subject to litigation if another party claims that we have infringed upon its intellectual property
rights.
The tools, techniques, methodologies, programs and components we use to provide our services may infringe upon
the intellectual property rights of others. Infringement claims generally result in significant legal and other costs and
may distract management from running our core business. Royalty payments under licenses from third parties, if
available, would increase our costs. If a license were not available, we might not be able to continue providing a
particular service or product, which could adversely affect our financial condition, results of operations and cash flows.
Additionally, developing non-infringing technologies would increase our costs.
Failure to obtain and retain skilled technical personnel could impede our operations.
We require highly skilled personnel to operate and provide technical services and support for our
business. Competition for the personnel required for our businesses intensifies as activity increases. In periods of high
utilization it may become more difficult to find and retain qualified individuals. This could increase our costs or have
other adverse effects on our operations.
Severe weather conditions may affect our operations.
Our business may be materially affected by severe weather conditions in areas where we operate. This may entail
the evacuation of personnel and stoppage of services. In addition, if particularly severe weather affects platforms or
structures, this may result in a suspension of activities. Any of these events could adversely affect our financial
condition, results of operations and cash flows.
Item 1B. Unresolved Staff Comments.
None.
Item 2. Properties.
Schlumberger owns or leases numerous manufacturing facilities, administrative offices, service centers, research
centers, data processing centers, mines, ore, drilling fluid and production chemical processing centers, sales offices
and warehouses throughout the world. Schlumberger views its principal manufacturing, mining and processing
facilities, research centers and data processing centers as its “principal owned or leased facilities.”
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