Doug SheridanManaging Director

EnergyPoint Research, Inc.

Customer Satisfactionin the Oil & Gas Industry

February 2011

Disclaimer

The information contained in this presentation, whether satisfaction ratings, stock quotes, charts, comments or any other statement or statements regarding market or other financial information, is obtained from sources which EnergyPoint Research and our suppliers believe to be reliable; however, EnergyPoint Research does not warrant or guarantee the timeliness or accuracy of this information. Nothing contained in this presentation should be interpreted to state or imply that past results are an indication of future performance. Neither EnergyPoint Research nor its information providers shall be liable for any errors or inaccuracies, regardless of cause, or the lack of timeliness of, or for any delay or interruption in the transmission thereof to the user. THERE ARE NO WARRANTIES, EXPRESSED OR IMPLIED, AS TO ACCURACY, COMPLETENESS, OR RESULTS OBTAINED FROM ANY INFORMATION INCLUDED IN THIS E-MAIL OR ON ENERGYPOINT RESEARCH’S WEBSITE. THIS PRESENATATION IS IN NO WAY A SOLICITATION OR OFFER TO SELL SECURITIES OR INVESTMENT ADVISORY SERVICES. RECIPIENTS AND READERS ARE ADVISED THAT ENERGYPOINT RESEARCH IS A SPECIALIST IN THE FIELD OF CUSTOMER SATISFACTION IN THE OIL AND GAS INDUSTRY AND THAT ENERGYPOINT RESEARCH IS NOT A SECURITIES ANALYST.

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EnergyPoint Research

Founded in 2003 Independently measure the oil and gas

industry’s satisfaction with product and service suppliers

Plays the same role in the oil and gas industry as:• J.D. Power & Associates plays in the automotive and other

consumer industries

• Consumer Reports plays in the consumer products and services sectors

Our Focus

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Rewards for Investors24-Month Returns vs. Satisfaction Rank

+12.1%

Out Performance *

Oilfield Products & Services

+33.4%

Out Performance *

* Relative to peer-group average.

BottomHalf

TopHalf

BottomQuartile

TopQuartile

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Top-rated Suppliers

Onshore Drilling: Helmerich & Payne

Offshore Drilling: Noble Ensco

Oilfield Services: M-I Swaco

Oilfield Products: Derrick Equipment

Smith International

Most Recent Surveys

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Other Standouts

Currently Rated “Four Stars” Carbo Ceramics – Ceramic Proppants

Derrick Equipment – Shale Shakers

Helmerich & Payne – U.S. Land Drilling

Lufkin Industries – Artificial Lift Equipment

Smith International – Integrated Products

Sumitomo Pipe – Oilfield Tubulars

Dominated by specialty suppliers

Most Recent Surveys

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Others to Watch

Showing Improvement Newpark Resources – Drilling Fluids

Oceaneering – ROVs & Other Subsea Equipment

Tetra Technologies – Products & Services

Potential for Improvement GE Oil & Gas – Wellhead, BOPs, risers, etc. *

* Potential challenger to companies like Aker Solutions, Cameron International, FMC Technologies and National Oilwell Varco

Good and/or Getting Better

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Other NotablesBased on EnergyPoint’s Four-star System

Services Products

Rating Trend Rating Trend

Baker Hughes 2.0 2.5

Cameron Int’l - - 2.5

FMC Technologies - - 1.5

Halliburton 2.5 3.0

National Oilwell Varco - - 1.0

Schlumberger 2.0 1.5

Transocean 1.5 - -

Weatherford Int’l 1.5 1.5

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Downward TrendRatings Lowest When Activity Highest

Commodity prices at or near recordhighs (some suppliers are still payinga price for how they treated andperformed for customers during thisperiod).

Customer satisfactionat or near lows

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Most Segments DownOffshore Drillers Buck the Trend

92

94

96

98

100

102

104

106

Land Drillers Offshore Drillers Services Products

2010 2004/05

Without HP’s rating of 113, segment would look much worse

Term contracts provide for more stable and predictable operations

HAL’s ratings improvements not enough to offset other’s declines

Customers feel trapped and frustrated with big players like NOV and Aker

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Ratings ComparisonsInside and Outside of the Industry

* Source: Most recent EnergyPoint and equivalent ACSI ratings.

10-pt Scale

All four industrysegments fall betweenthe US Postal Serviceand the IRS

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Industry ConsolidationOn Average, Not Good for Customer Sat

Rating Before the Deal Rating After

The Deal Transaction Purchaser Purchased

National Oilwell – Varco

1.0 1.0 1.0

Transocean – Global Santa Fe

3.0 1.5 1.5

GE – Vetco Gray n/a 2.0 1.0

GE – Hydril n/a 2.0 2.0

Precision – Grey Wolf 3.0 1.0 2.5

Baker – BJ Services 2.5 2.0 ?

Schlumberger – Smith

Ensco – Pride

2.0

3.5

4.0

3.0

?

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Is Bundling a Good Thing?Customer Ratings Raise Questions

# of Products / Services Used by Customer

EP

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Ind

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But Statistically Significant Lower Ratings from Customers Using Larger Numbers of Products and Services from a Single Supplier Suggest Otherwise

Conventional Wisdom Says a Broader Set of Offerings Leads toHigher Customer Satisfaction Because of Greater Selection, One-Stop-Shopping Benefits, etc.

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Subsea Looks Underserved

Multiple Subsea ProductsSeen as Falling Short

BOP & Wellhead RatingsFavor Surface-based Applications

As Subsea RatingsLag Other Product Categories

Away from Land,Ratings Deteriorate

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Subsea ProductsBig Room for Improvement

L-T Industry-wideAverage

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Drivers of Customer Sat

Oilfield Services/Drilling Highly Important – Performance and reliability

Important – Job quality; service and professionalism

Oilfield Products Highly Important – Engineering and design

Important – Corporate capabilities; performance and reliability; and personnel

Note – Pricing is not a large driver of customer satisfaction, although

value (i.e., quality-for-price-paid) is.

Less About Price Than You’d Think

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Healthy & SafetyPositive Grades from Customers

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