International Revenue per Rig

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Resource Triangle
Source Dr. Steve Holditch, Texas AM University
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Lower 48 U.S. Gas Production
TCF (Annual)
Tight Gas SandsShale Coalbed Methane
Source Energy Information Administration non
affiliated natural gas production
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Revenue Profile
WellConstruction
Production Enhancement

• Stimulation
• Coiled Tubing
• Completion Tools
• Completions Fluids
• Production Chemicals

• Cementing
• Tubular Services

29 of Total Revenue
65 of Total Revenue
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Geographic Presence

• Products Services
• Fracturing
• Acidizing
• Coiled Tubing
• Cementing
• Casing Tubing
• Completion Tools
• Completion Fluids
• Process Pipeline
• Chemical Services

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Geographic Profile - Revenue
2005 Revenue - 3.2 billion
United States 56
Middle East /Asia11
Canada 12
Europe / Africa / CIS12
Latin America9
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Consolidated Revenue
Worldwide Rigs
Revenue (millions)
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Revenue and Margin Performance
Revenue ( mm)
Operating Income Margins

• Revenue growth
• - Strong North America activity
• - Steady International growth
• Doubled operating income margins

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Resource Triangle
Source Dr. Steve Holditch, Texas AM University
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Most Beneficial Technologies
(Source January 2006 Oil and Gas Reporter)
Respondents Fracturing/Stimulat
ion 68.6 Seismic/Geophysics
56.5 Horizontal/Directional Drilling
35.2 Workover/Well Servicing
28.6 Logging/Formation Evaluation
27.6 Artificial Lift 21.0 Enhanced
Recovery 19.0 Reservoir
Characterization 9.5 Production
Automation 7.6 Drilling Fluids
5.7 Information Technology 4.9
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North America Intl Stimulation
Revenue ( mm)
Worldwide Rigs
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International Stimulation
(excludes U.S. and Canada)
Intl Revenue ( mm)
International Rigs

• Future Growth Drivers
• Maturing Fields
• Unconsolidated Formations
• Natural Gas Drilling

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Fracturing Market - 2005
Established Fracturing Market
Developing Fracturing Market
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Oilfield Services Group
Revenue ( mm)
Worldwide Rigs

• 16 of Consolidated Revenue
• Worldwide rigs up 44
• Oilfield Services revenue up 167

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Growth Expectations

• Short Term Growth (FY2007)
• Consolidated Revenue up 20 versus FY 2006
• - North America up 20
• - International Pumping up 20
• - Oilfield Services Group up 18
• Long Term Fundamentals
• U.S. Gas Production Difficult to Maintain
• - Smaller reservoirs resulting in more wells
  drilled
• - Unconventional formations driving more
  stimulation
• Growing International Gas Demand
• Maturing of Major Oil Fields

More Stimulation
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Research and Engineering Commitment

• Technology Focus
• Mature Field Production Enhancement
• Unconventional Reservoirs
• Harsh Environment Well Construction and
  Completion
• Production and Completion of Multi-Zones in
  Single Wellbores

65 Million
27 Million
6 year CAGR of 15
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Mature Field Production Enhancement

• SandStone Acid
• Matrix Acidizing
• Production Chemicals
• AquaCon
• DynaCoil
• Thru-Tubing Sand Screens
• Re-Fracturing

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Unconventional Reservoirs

• Low Polymer Frac Fluids
• LiteProp
• Enzyme Breakers
• Liquid LiteProp
• Gorilla Frac Pumps

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Harsh Environment

• Insulgel
• Icecheck
• Foamed Cement
• Shallow Water Flow Cement Systems
• High Temp Retarders
• HPHT Packers
• Falcon Tucano Cementers

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Multi-Zone Production and Completions

• Multi-Zone Single Trip (MST) Completion Tool
  System
• Excape Completion Tool
• Coiled Tubing Frac

ComPleteTM MST
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Capital Investment
Capital Spending in millions
to 475
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Equipment Manufacturing
Canada
Texas
Dubai
Singapore
Argentina
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Equipment Investment
Latest Technology More Capacity per
Unit Redundant Systems Practical
Automation Enhanced Reliability
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Hydraulic Fracturing Efficiencies
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Employee Development

• Enhanced Recruiting and Training Efforts
• - Increased recruiting staff
• - Expand college and university coverage
• - Increased training personnel
• Career Advancement Programs (CAP)
• - Equipment Operators
• - Mechanics
• - Facility personnel
• - Technical personnel
• Maintain Competitive Compensation and Benefits
• - Compensation reviews
• - Implemented retaining strategies

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Financial Overview
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Q3 2006 Operating Results
(s in millions except per share amounts)
Year over Year
Q3 06 Q3 05 Change Revenue 1,117
817 37 Average Rigs 2,822
2,435 16 Operating Income 307
164 87 Revenue 27.5
20.0 7.5 Earnings per Share
0.67 0.35 91
Incremental Operating Income Margins of 48
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Q3 2006 Operating Results
(s in millions except per share amounts)
Sequential
Q3 06 Q2 06 Change Revenue 1,117 1,078
4 Average Rigs 2,822 3,080
- 8 Operating Income 307
295 4 Revenue 27.5
27.4 0.1 Earnings per Share 0.67
0.63 6
Incremental Operating Income Margins of 31
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Financial Strength
( millions)
Net Debt / Cap
Net Debt
Net Debt / Cap
Financial Liquidity _at_
6/30/06Borrowing Capacity (35 debt / cap)
1,250 Outstanding Debt
(603) Incremental Borrowing Capacity 647
Cash Balance 383 Total
Liquidity 1,030
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Financial Flexibility

• Organic Growth
• Strategic Acquisitions
• Debt Retirement
• Treasury Share Purchases
• Dividends

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Treasury Share Purchases
s (millions) Shares
(000s) First Quarter 18.9
538 Second Quarter
93.1 2,785 Third Quarter
656.4 18,229 Through 10-Q
248.5 6,892 Fiscal Year to Date
1,017 28,443
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