Baker Hughes Company · NASDAQ:BKR
Baker Hughes — JP Morgan Russia presentation (December 2007)
16 slides from Baker Hughes's conference presentation, December 2007
Slide 1: A World of Opportunities: Russia
A World of Opportunities: Russia AA C CENTURY OF IINNOVATON ENTURY OF NNOVATON A CENTURY OF INNOVATON 1
Slide 2: Forward Looking Statements
Forward Looking Statements Some of the things we will discuss today relative to our views on future company performance and results, and other statements not dealing with historical facts, will be forward-looking statements within the meaning of U.S. securities laws. The company cautions that actual
Slide 3: Baker Hughes and Russia
Baker Hughes and Russia A World of Opportunities Committed to Our Long Term Strategy Driving Growth through our Investment in People, Infrastructure and Innovation Portfolio of Best-in-Class Technologies Market and Technology Leadership Focus on Reliability Success in Key Markets National Oil Compan
Slide 4: Brownfield Miracle is Over
Brownfield Miracle is Over Russian crude production growth % YoY Oil production for 1H 2007 = 12 3.1% up from prior year Exhaustion of EOR techniques 10 and flat drilling activity has 8 led to the decline in the rate of growth of hydrocarbon 6 production 4 Brownfields emphasize pressure pumping and
Slide 5: Market is Becoming Drilling Led
Market is Becoming Drilling Led Production Drilling – Russia 2000-2015 (millions meters) Upstream investments shift to 30 production drilling 25 Expecting 10.5% CAGR in meterage drilled through 20 2015 15 Rig count, well mix and efficiency driven 10 Obvious benefits for directional 5 drilling, fluid
Slide 6: Market Dynamics
Market Dynamics 25 Other The market is shifting East Siberia 20 Timon-Pichora – Geographic distribution will Volga-Urals reflect shift to greenfield West Siberia developments 15 – disproportionate investment required 10 Baker Hughes opportunities include – To add value through service 5 and technolo
Slide 7: Market Opportunities
Market Opportunities Gazprom Shtokman Greenfield Gas Gazprom Yamal Greenfield Gas Rosneft Vankor Greenfield Oil Western Siberia TNK-BP Verkhnechonsk Brownfield Oil Greenfield Oil Surgutneftegas Talakan Greenfield Oil TNK-BP Kovytka Greenfield Gas Sakhalin Phase 2 Lukoil N. Caspian Greenfield Oil A C
Slide 8: Market Dynamics
Market Dynamics Market Segm entation • The market is shifting 100% – Service provider profile 90% evolving as VIOC’s shed 80% service assets 70% – Boundary between Western 60% and Russian independents is 50% increasingly blurry 40% • Baker Hughes 30% opportunities include 20% – participation in indu
Slide 9: Competitive Landscape - Today
Competitive Landscape - Today $1.5B $1.8B $2.0B A CENTURY OF INNOVATON 9
Slide 10: Infrastructure
Infrastructure Baker Hughes HQ in Moscow Operations Bases in: – Noyabrsk, Buzuluk, Orenburg, Sakhalin – (in progress) Nefteugansk, Usinsk Additional Repair & Maintenance Facilities in: – Usinsk, Astrakhan – Muravlenko Other offices located in: – Novosibirsk, Nizhnevartovsk, Samara, Volgograd, Irkuts
Slide 11: Geographic Segmentation
Geographic Segmentation Major facilities Repair & Maintenance facilities Sales & support offices Bovanenkovo Research Center Field (Gazprom) Vankor Field (Rosneft) Talakan Field (SurgutNG) Korchagina Field (Lukoil) Verkhnechonsky Field (TNK-BP) A CENTURY OF INNOVATON 11
Slide 12: Investment in People
Investment in People • Expanding workforce – over 90% Russian- speaking – Trebled in last 18 months • Graduate Recruitment & University Cooperation Programs: – Gubkin Oil & Gas University; – Tomsk Polytechnic; – Ufa State Petroleum University; – Heriot-Watt graduate program sponsorship; – Campus rec
Slide 13: Growth & Investment in Russia
Growth & Investment in Russia Growing local sales, service and rental capability – strengthening field presence – Service-related revenues growing at double the rate of sales – NCE, and CAPEX have Photos / art from both more than doubled BOT, Centrilift, INTEQ,… prior year levels – All of our divisi
Slide 14: Focus on Applied Technologies
Focus on Applied Technologies Drilling & Evaluation: – Sidetracks & multi-laterals – Extended-reach drilling – Bundled solutions Completion & Production: – ESP market development – Water Management – Multi-lateral completions – Intelligent completions – Oil treatment solutions A CENTURY OF INNOVATON
Slide 15: Challenges and Opportunities
Challenges and Opportunities • Forging new relationships with state- controlled companies – Gazprom – Rosneft • Customer need for technology in greenfield developments • Vast geographic territory, establishing the footprint • Competing successfully across market segments A CENTURY OF INNOVATON 15
Slide 16: A C ENTURY OF I NNOVATON
2aG BAKER HUGHES a A CENTURY OF INNOVATON
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