2
and deepwater markets. In land seismic, we continued UniQ*
technology deployment, and we formed a new division to sell
or lease this technology to other companies. In wireline log-
ging, ThruBit* openhole services, acquired in December 2011,
saw a rapidly growing customer base to find application in
unconventional reservoirs. We also released the latest version
of the INTERSECT* reservoir simulator that offers significant
advances in modeling, particularly for complex subsurface
structures. Schlumberger and Chevron have collaborated on
INTERSECT technology for more than a decade and Total
joined the collaboration in 2012.
In the Drilling Group, new technology introductions included
the MicroScope* high-resolution resistivity and imaging-
while-drilling service that helps customers estimate reserves,
position horizontal wells, and optimize completion design
more precisely. We also introduced NeoScope* logging-while-
drilling technology that eliminates the need for chemical
sources by using an electronic neutron generator. During the
year we passed a significant milestone with Smith Bits taking
market leadership according to Spears market survey data.
This achievement marks the value of combining Smith tech-
nology with Schlumberger global reach. At the same time, the
Drilling Group continued to focus on making a step change in
drilling performance through total system integration. This
will benefit from further fundamental research in drilling
technology to be conducted at the Schlumberger Gould
Research Center in Cambridge, UK, which we inaugurated
in October.
New Production Group technologies also made substantial
headway. The unique HiWAY* channel fracturing service
continued to grow rapidly and only two years after its intro-
duction, more than 10,000 operations have been performed
for more than 80 customers in 15 countries. In addition to
established markets in North America, HiWAY technology
penetrated other basins to support production improvement
and cost savings as indicated by a study that showed average
production of HiWAY treated wells to be 65% higher than
those completed with conventional technology in the
Eagleford Formation. In a related development, we intro-
duced Mangrove* software to optimize perforation and
completion design using reservoir measurements. Mangrove
technology forms part of our approach of bringing more
science to unconventional resource development.
Subsea technology saw some exciting developments during
the year. This market is expected to see strong growth in the
future and we underlined our position with contract wins for
unique Framo technology on the Gullfaks project for Statoil
and in the Draugen field for Shell. Framo Engineering AS,
of which we acquired full ownership in 2011, is a leader in
subsea boosting and metering and will form part of our con-
tribution to the planned creation of the OneSubsea™ joint
venture with Cameron that was announced in November.
As we begin 2013, the world macroeconomic environment
remains uncertain. However, global oil demand is expected
to grow at similar levels to those seen in 2012 and 2011 and
supply will see further growth in North America as light tight
oil production increases. Other non-OPEC production, how-
ever, can be expected to continue to face delays and decline
challenges. As a result, global spare capacity should remain
largely unchanged absent any unexpected macroeconomic or
geopolitical events, and this will support oil prices within the
band we have seen since 2011. For natural gas, little change
is expected in the behavior of the main geographical markets
in 2013.
In closing, I would like to thank our customers for their confi-
dence and support, and our employees for their dedication
and commitment. With international E&P spending forecast
to increase by around 10% in the coming year and a strong
activity outlook for the US Gulf of Mexico, Schlumberger is
well positioned for growth with a balanced business portfolio,
wide geographical footprint, and strong executional capability.
Paal Kibsgaard
Chief Executive Officer
