global oil & gas drilling services

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Global - Oil & Gas Drilling 0199 - 2117 - 2010

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INDUSTRY PROFILE

Global Oil & Gas Drilling

Reference Code: 0199-2117

Publication Date: April 2011

EXECUTIVE SUMMARY



EXECUTIVE SUMMARY

Market value

The global oil & gas drilling sector grew by 36.7% in 2010 to reach a value of $81.9 billion.

Market value forecast

In 2015, the global oil & gas drilling sector is forecast to have a value of $124.5 billion, an increase of 52.1% since 2010.

Market volume

The global oil & gas drilling sector grew by 32.4% in 2010 to reach a volume of 572 million feet.

Market volume forecast

In 2015, the global oil & gas drilling sector is forecast to have a volume of 678.5 million feet, an increase of 18.6% since 2010.

Market segmentation I

Crude Oil is the largest segment of the global oil & gas drilling sector, accounting for 64% of the sector's total value.

Market segmentation II

Americas accounts for 75.1% of the global oil & gas drilling sector value.

Market share

Transocean, Inc. is the leading player in the global oil & gas drilling sector, generating a 11.9% share of the sector's value.

Market rivalry

Volatile commodity fuel prices continue to affect the sector due to the knock on effects of the global recession taking their toll on consumption levels.

CONTENTS



TABLE OF CONTENTS

EXECUTIVE SUMMARY 2

MARKET OVERVIEW 7

Market definition 7 Research highlights 8 Market analysis 9

MARKET VALUE 10

MARKET VOLUME 11

MARKET SEGMENTATION I 12

MARKET SEGMENTATION II 13

MARKET SHARE 14

FIVE FORCES ANALYSIS 15

Summary 15 Buyer power 17 Supplier power 18 New entrants 19 Substitutes 21 Rivalry 22

LEADING COMPANIES 23

Halliburton Company 23 Nabors Industries, Inc. 28 Noble Corporation 32 Transocean Ltd. 35

MARKET FORECASTS 39

Market value forecast 39 Market volume forecast 40

APPENDIX 41

Methodology 41 Industry associations 42

CONTENTS



Related Datamonitor research 42 Disclaimer 43

ABOUT DATAMONITOR 44

Premium Reports 44 Summary Reports 44 Datamonitor consulting 44

CONTENTS



LIST OF TABLES Table 1: Global oil & gas drilling sector value: $ billion, 2006–10 10

Table 2: Global oil & gas drilling sector volume: million feet, 2006–10 11

Table 3: Global oil & gas drilling sector segmentation I:% share, by value, 2010 12

Table 4: Global oil & gas drilling sector segmentation II: % share, by value, 2010 13

Table 5: Global oil & gas drilling sector share: % share, by value, 2010 14

Table 6: Halliburton Company: key facts 23

Table 7: Halliburton Company: key financials ($) 25

Table 8: Halliburton Company: key financial ratios 26

Table 9: Nabors Industries, Inc.: key facts 28

Table 10: Nabors Industries, Inc.: key financials ($) 30

Table 11: Nabors Industries, Inc.: key financial ratios 30

Table 12: Noble Corporation: key facts 32

Table 13: Noble Corporation: key financials ($) 33

Table 14: Noble Corporation: key financial ratios 33

Table 15: Transocean Ltd.: key facts 35

Table 16: Transocean Ltd.: key financials ($) 37

Table 17: Transocean Ltd.: key financial ratios 37

Table 18: Global oil & gas drilling sector value forecast: $ billion, 2010–15 39

Table 19: Global oil & gas drilling sector volume forecast: million feet, 2010–15 40

CONTENTS



LIST OF FIGURES Figure 1: Global oil & gas drilling sector value: $ billion, 2006–10 10

Figure 2: Global oil & gas drilling sector volume: million feet, 2006–10 11

Figure 3: Global oil & gas drilling sector segmentation I:% share, by value, 2010 12

Figure 4: Global oil & gas drilling sector segmentation II: % share, by value, 2010 13

Figure 5: Global oil & gas drilling sector share: % share, by value, 2010 14

Figure 6: Forces driving competition in the global oil & gas drilling sector, 2010 15

Figure 7: Drivers of buyer power in the global oil & gas drilling sector, 2010 17

Figure 8: Drivers of supplier power in the global oil & gas drilling sector, 2010 18

Figure 9: Factors influencing the likelihood of new entrants in the global oil & gas drilling sector, 2010 19

Figure 10: Factors influencing the threat of substitutes in the global oil & gas drilling sector, 2010 21

Figure 11: Drivers of degree of rivalry in the global oil & gas drilling sector, 2010 22

Figure 12: Halliburton Company: revenues & profitability 26

Figure 13: Halliburton Company: assets & liabilities 27

Figure 14: Nabors Industries, Inc.: revenues & profitability 31

Figure 15: Nabors Industries, Inc.: assets & liabilities 31

Figure 16: Noble Corporation: revenues & profitability 34

Figure 17: Noble Corporation: assets & liabilities 34

Figure 18: Transocean Ltd.: revenues & profitability 38

Figure 19: Transocean Ltd.: assets & liabilities 38

Figure 20: Global oil & gas drilling sector value forecast: $ billion, 2010–15 39

Figure 21: Global oil & gas drilling sector volume forecast: million feet, 2010–15 40

MARKET OVERVIEW



MARKET OVERVIEW

Market definition

The global oil & gas drilling sector is deemed to be the revenues accrued by drilling contractors or owners of drilling rigs that contract their services for drilling wells.

Note that the contract revenues used in calculating company market share may include a component from drilling equipment sales, etc.

The regional segmentation has been calculated according to regional ownership of rotary rigs.

Any currency conversions used in this report have been calculated using constant 2010 annual average exchange rates.

For the purposes of this report, the global market consists of North America, South America, Western Europe, Eastern Europe, MEA, and Asia-Pacific.

North America consists of Canada, Mexico, and the United States.

South America comprises Argentina, Brazil, Chile, Colombia, and Venezuela.

Western Europe comprises Belgium, Denmark, France, Germany, Greece, Italy, the Netherlands, Norway, Spain, Sweden, Switzerland, Turkey, and the United Kingdom.

Eastern Europe comprises the Czech Republic, Hungary, Poland, Romania, Russia, and Ukraine.

Asia-Pacific comprises Australia, China, India, Indonesia, Japan, New Zealand, Singapore, South Korea, Taiwan, and Thailand.

Middle East-Africa (MEA) comprises Egypt, Israel, Nigeria, Saudi Arabia, South Africa, and United Arab Emirates.

MARKET OVERVIEW



Research highlights

The global oil & gas drilling sector had total revenue of $81.9 billion in 2010, representing a compound annual growth rate (CAGR) of 11.6% for the period spanning 2006-2010

Sector consumption volumes decreased with a compound annual rate of change (CARC) of -0.2% between 2006 and 2010, to reach a total of 572 million feet in 2010.

The performance of the sector is forecast to decelerate, with an anticipated CAGR of 8.7% for the five-year period 2010-2015, which is expected to drive the sector to a value of $124.5 billion by the end of 2015.

MARKET OVERVIEW



Market analysis

The global oil & gas drilling sector decelerated rapidly from very strong growth to a very strong decline in 2009. A strong recovery in 2010 is expected to be followed by moderate to strong growth rates over the forecasted period.

The global oil & gas drilling sector had total revenues of $81.9 billion in 2010, representing a compound annual growth rate (CAGR) of 11.6% for the period spanning 2006-2010. In comparison, the European and Asia-Pacific sectors grew with CAGRs of 13% and 11.2% respectively, over the same period, to reach respective values of $2.5 billion and $7.7 billion in 2010.

Sector consumption volumes decreased with a compound annual rate of change (CARC) of -0.2% between 2006 and 2010, to reach a total of 572 million feet in 2010. The sector's volume is expected to rise to 678.5 million feet by the end of 2015, representing a CAGR of 3.5% for the 2010-2015 period.

The crude oil segment was the sector's most lucrative in 2010, with total revenue of $52.4 billion, equivalent to 64% of the sector's overall value. The natural gas segment contributed revenue of $29.5 billion in 2010, equating to 36% of the sector's aggregate value.

The performance of the sector is forecast to decelerate, with an anticipated CAGR of 8.7% for the five-year period 2010-2015, which is expected to drive the sector to a value of $124.5 billion by the end of 2015. Comparatively, the European and Asia-Pacific sectors will grow with CAGRs of 5.3% and 8.1% respectively, over the same period, to reach respective values of $3.3 billion and $11.3 billion in 2015.

MARKET VALUE



MARKET VALUE

The global oil & gas drilling sector grew by 36.7% in 2010 to reach a value of $81.9 billion.

The compound annual growth rate of the sector in the period 2006–10 was 11.6%.

Table 1: Global oil & gas drilling sector value: $ billion, 2006–10 Year $ billion € billion % Growth2006 52.7 39.7 2007 86.4 65.1 63.9%2008 93.2 70.2 7.8%2009 59.9 45.1 (35.7%)2010 81.9 61.7 36.7%

CAGR: 2006–10 11.6%

Source: Datamonitor D A T A M O N I T O R

Figure 1: Global oil & gas drilling sector value: $ billion, 2006–10


MARKET VOLUME



MARKET VOLUME

The global oil & gas drilling sector grew by 32.4% in 2010 to reach a volume of 572 million feet.

The compound annual rate of change of the sector in the period 2006–10 was -0.2%.

Table 2: Global oil & gas drilling sector volume: million feet, 2006–10 Year million feet % Growth2006 576.62007 587.9 2.0%2008 621.3 5.7%2009 432.2 (30.4%)2010 572.0 32.4%

CAGR: 2006–10 (0.2%)


Figure 2: Global oil & gas drilling sector volume: million feet, 2006–10


MARKET SEGMENTATION I



MARKET SEGMENTATION I

Crude Oil is the largest segment of the global oil & gas drilling sector, accounting for 64% of the sector's total value.

The natural gas segment accounts for the remaining 36% of the sector.

Table 3: Global oil & gas drilling sector segmentation I:% share, by value, 2010 Category % ShareCrude Oil 64.0%Natural Gas 36.0%

Total 100%


Figure 3: Global oil & gas drilling sector segmentation I:% share, by value, 2010


MARKET SEGMENTATION II



MARKET SEGMENTATION II

Americas accounts for 75.1% of the global oil & gas drilling sector value.

RoW accounts for a further 12.5% of the global sector.

Table 4: Global oil & gas drilling sector segmentation II: % share, by value, 2010 Category % ShareAmericas 75.1%RoW 12.5%Asia-Pacific 9.4%Europe 3.1%

Total 100%


Figure 4: Global oil & gas drilling sector segmentation II: % share, by value, 2010


MARKET SHARE



MARKET SHARE

Transocean, Inc. is the leading player in the global oil & gas drilling sector, generating a 11.9% share of the sector's value.

Halliburton, Inc. accounts for a further 9.6% of the sector.

Table 5: Global oil & gas drilling sector share: % share, by value, 2010 Company % ShareTransocean, Inc. 11.9%Halliburton, Inc. 9.6%Nabors Industries, Inc. 4.4%Noble Corporation 3.5%Other 70.5%

Total 100%


Figure 5: Global oil & gas drilling sector share: % share, by value, 2010


FIVE FORCES ANALYSIS




The oil & gas drilling market will be analyzed taking providers of drilling services as players. The key buyers will be taken as oil and gas companies, and drilling equipment manufacturers and human resources as the key suppliers.

Summary

Figure 6: Forces driving competition in the global oil & gas drilling sector, 2010


Volatile commodity fuel prices continue to affect the sector due to the knock on effects of the global recession taking their toll on consumption levels.

The oil and gas drilling sector is fairly fragmented, although four large international companies (Nabors Industries, Transocean, Halliburton and Noble Corp) do account for around 30% of global revenues. These players have developed numerous drilling units with both onshore and offshore capabilities. The typical size of buyers is large, which grants them greater bargaining power. After early 2008 saw the biggest rally in fuel prices in eight years, the cost of crude oil surged to record highs. However, oil and gas prices fell dramatically as a result of the recession with crude oil prices falling from as high as $150 in 2008, to $40 a barrel at the turn of the New Year in 2009. They have rebounded since, however, reaching $91 a barrel in December 2010. The level of technology required, and the high operating and fixed costs constitute a strong barrier to entry and thereby reduce the threat of new players establishing themselves in this sector.




A further barrier to entry is the level of government regulation present in the oil and gas industries, which, although reduced in the US in 2008, might be increased again following the Deepwater Horizon oil spill (BP oil spill) in April 2010. Drilling for oil and gas is associated with greenhouse gas emission, PAH releasing, oil spills, seismic noises, and so on, and remedying these environmental impacts may be costly for drilling companies. There are no direct substitutes for drilling where substantial depths must be reached, the threat from substitutes in this sector is considered to be weak.




Buyer power

Figure 7: Drivers of buyer power in the global oil & gas drilling sector, 2010


Buyers include global energy firms, national petroleum companies, and independent operators, such as Chevron, BP, or Shell. The typical size of such players is large, therefore granting them greater bargaining power within the sector. Furthermore, because the services offered by drilling contractors are similar and there is little variation involved in the drilling process, buyers within this sector have a greater degree of choice amongst players, which will strengthen buyer power to some extent. The prevalence of contracts in the sector tends to reduce buyer power somewhat, as switching from one service provider to another can incur switching costs. Overall, buyer power within the global oil and gas drilling sector is considered to be moderate.




Supplier power

Figure 8: Drivers of supplier power in the global oil & gas drilling sector, 2010


Suppliers to this sector include producers of drilling equipment such as Canrig (a subsidiary of Nabors Industries), which is one of the leading suppliers to the oil and gas industries in many regions. As the sector is labor intensive, there are also human resources providers amongst the suppliers. The bulk of the sector’s required equipment consists of heavy-duty mechanical structures composed of metal components. Such components vary depending on the specific drill, but usually materials such as steel, tungsten carbide, or imbedded small industrial diamonds can be used. The fact that there are very few suitable substitutes available for these tools strengthens supplier power in this market. Many equipment suppliers saw their revenues drop as a result of the huge fall in the commodity price of crude oil towards the later part of 2008, caused by the global economic recession. However, prices recovered in 2010, reaching $91 a barrel in December. The recession has seen global oil consumption levels fall for the first time in over 15 years amid a slowdown in industrial production as companies cut their production levels, or in the case of failing companies, cease production altogether. The fall in consumption has been small, however, from its peak in 2007 of 85,619 thousand barrels a day, to 84,007 thousand in 2009. Overall, supplier power is considered to be moderate.




New entrants

Figure 9: Factors influencing the likelihood of new entrants in the global oil & gas drilling sector,

2010


This sector is differentiated into onshore and offshore drilling. Examples of this differentiation can be seen in the operations of leading players such as Nabors Industries, who operate both onshore and offshore rigs, and Transocean, who specialize in offshore operations. Such companies enjoy an international presence and have established a considerable number of drilling units. These units have often received substantial investments in equipment, construction and technology. Transocean, for example, uses deepwater rigs that are capable of operating in water depths of 4,500 feet (1,500 meters) or greater, as well as drillships and semi-submersible rigs. Laser Applications Laboratories are currently working on adapting high-power laser technology for gas and oil drillings to replace mechanical drilling methods. Researchers believe that lasers have the potential to penetrate rock at 10 to 100 times faster than conventional boring technologies – a huge benefit in reducing the high costs of operating a drill rig. Factors such as the foregoing mean that in order to compete with the major players in this sector, significant capital outlay for R&D is necessary. The level of technology required, and the high costs of production, constitute a strong barrier to entry and thereby reduce the threat of new players establishing themselves in this sector. A further barrier to entry is the level of government regulation present in the oil and gas industries. In the US, for example, offshore drilling is restricted. Since 1981, a congressional moratorium has prohibited oil and gas drilling along the east and west coasts and in the eastern Gulf of Mexico, an area accounting for some 80% of the US's Outer Continental Shelf.




The Interior Department estimates that the Outer Continental Shelf holds 86 billion barrels of oil and 420 trillion cubic feet of natural gas that have yet to be discovered. This moratorium was lifted, however, in September 2008 in a bid to reduce the US’ dependence on foreign oil – this could have the potential to attract new entrants. However, regulation could be tightened in light of the Deepwater Horizon oil spill (BP oil spill) which occurred in April 2010, labeled the largest accidental marine oil spill in the history of the petroleum industry. As well as regulations surrounding taxation and the issue of whether oil and gas exploration is permitted, there are also restrictions regarding environmental impact. Drilling for oil and gas is associated with emissions of greenhouse gases and polycyclic aromatic hydrocarbons (PAH) a category of widespread organic pollutants associated with oil wells, oil spills, seismic noise harming wildlife, and more. Reducing this environmental impact may be costly for drilling companies. For example, in May 2008, ExxonMobil had to suspend exploration near Madagascar because more than 100 whales had beached themselves. In the US, the discharge of materials manufactured as a result of drilling is also subjected to regulation, and operating companies are required to remove any materials that are deemed damaging to the environment. There are also other uncertainties. After early 2008 saw the biggest rally in fuel prices in eight years, the cost of crude oil surged to record highs. However, oil and gas prices fell dramatically as a result of the recession with crude oil prices falling from as high as $150 in 2008, to $40 a barrel at the turn of the New Year in 2009. By the end of 2010, prices had recovered, reaching $91 a barrel in December. Thus, new entrants must have a business model robust enough to survive severe fluctuations in demand driven by the volatility of fossil fuel prices. Overall, the threat posed by new entrants to the oil and gas drilling sector is moderate.




Substitutes

Figure 10: Factors influencing the threat of substitutes in the global oil & gas drilling sector, 2010


Drilling contractors provide slightly differentiated services depending on the location of the rig, that is, whether it is onshore or offshore. There is no direct substitute for this service, however, scientists are constantly looking for more efficient and environmentally-friendly drilling solutions. When demand for oil is high, oil companies may find it economical to exploit oil shelves, which require strip-mining techniques rather than conventional drilling. Currently, the majority of the world’s energy production takes place with the use of non-renewable sources (oil, gas and coal). However, in order to fight climate change, it is widely accepted that it will be necessary to shift to renewable energy sources, and oil companies may begin to diversify into these areas, reducing their demand for drilling services. However, at present, as there are no direct substitutes for drilling where substantial depths must be reached. The threat from substitutes in this sector is considered to be weak.




Rivalry

Figure 11: Drivers of degree of rivalry in the global oil & gas drilling sector, 2010


The global oil and gas drilling sector is fairly fragmented with a substantial number of companies present, although the leading players, namely: Transocean, Halliburton, Noble Corp and Nabors, are involved in large-scale international operations and collectively hold around 30% of the market value. Oil and gas drilling contractors are similar in the way they operate and the services they provide. Many companies, such as Nabors Industries, have drilling units both onshore and offshore. However, some companies in this sector have specialized in particular drilling locations: Transocean, for example, specializes in offshore drilling. Substantial fixed costs and the high exit barriers created by the need to divest industry-specific equipment on leaving the sector both mean that rivalry within this sector is substantial. This degree of rivalry is further strengthened by the fact that players in this sector have not generally diversified their operations beyond services relating to oil and gas, making them more reliant on revenues from drilling. As a result of the decline in consumption levels in 2009, especially in the developed economies, competitive rivalry is likely to increase as players compete to maintain their revenues, despite the decreased capacity of the market. However this is only expected to be short term due to the dependence on oil & gas in the global economy. Furthermore, rising oil prices over the course of 2010 are likely to increase rivalry to some extent. The degree of rivalry amongst players operating in the oil and gas drilling sector is therefore considered to be moderate.

LEADING COMPANIES



LEADING COMPANIES

Halliburton Company

Table 6: Halliburton Company: key facts Head office: 5 Houston Center, Suite 2400, 1401 McKinney Street, Houston,

Texas 77010, USA Telephone: 1 713 759 2600 Website: www.halliburton.com Financial year-end: December Ticker: HAL Stock exchange: New York Source: company website D A T A M O N I T O R

The Halliburton Company (Halliburton) is an oilfield services company and a provider of engineering and construction services. It offers a wide range of services and products for the exploration, development, and production of oil and gas. The company has operations in about 70 countries covering the regions of the Americas, Europe, the Middle East and Asia Pacific.

The company provides a broad range of discrete and integrated services and products to the energy industry. Halliburton sells its products and services to major, national, and independent oil and gas companies worldwide. The company serves the upstream oil and gas industry throughout the lifecycle of the reservoir: from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the field.

Halliburton provides all of these services through two business segments: the completion and production segment and the drilling and evaluation segment.

The completion and production segment offers cementing, stimulation, intervention, and completion services. This segment constitutes production enhancement services, completion tools and services, and cementing services.

Under its production enhancement services, the company offers stimulation services, pipeline process services, sand control services, and well intervention services. Stimulation services optimize oil and gas reservoir production through a variety of pressure pumping and nitrogen services and chemical processes, commonly known as hydraulic fracturing and acidizing. Pipeline process services include pipeline and facility testing, commissioning, and cleaning via pressure pumping, chemical systems, specialty equipment and nitrogen. These services are provided to the midstream and downstream sectors

LEADING COMPANIES



of the energy business. Sand control services include fluid and chemical systems and pumping services for the prevention of the formation of sand. Well intervention services enable live well intervention and continuous pipe deployment capabilities through the use of hydraulic work-over systems and coiled tubing tools and services.

Through its completion tools and services, Halliburton offers subsurface safety valves and flow control equipment, surface safety systems, packers and specialty completion equipment, intelligent completion systems, expandable liner hanger systems, sand control systems, well servicing tools, and reservoir performance services. Reservoir performance services include testing tools, real-time reservoir analysis and data acquisition services.

Cementing services include bonding the well and well casing while isolating fluid zones and maximizing wellbore stability. In addition, it provides casing equipment.

The drilling and evaluation segment of Halliburton provides its customers with field and reservoir modeling, drilling, evaluation, and well construction solutions that enable its customers to model, measure, and optimize their well placement, stability, and reservoir evaluation activities. The drilling and evaluation segment performs fluid services, drilling services, drill bits, wire-line and perforating services, testing and subsea services, software and asset solutions, and project management.

Fluid services provides drilling fluid systems, performance additives, completion fluids, solids control, specialized testing equipment and waste management services for oil and gas drilling, completion, and work-over operations.

Drilling services offers drilling systems and services. These services comprise directional and horizontal drilling, measurement-while-drilling, logging-while-drilling, surface data logging, multilateral systems, underbalanced applications, and rig site information systems.

Drill bits provide roller cone rock bits, fixed cutter bits, hole enlargement, and related down-hole tools and services used in the drilling of oil and gas wells. In addition, coring equipment and services are provided to acquire cores of the formation for evaluation.

Wire-line and perforating services include open-hole wire-line services that provide information on formation evaluations, including resistivity, porosity, and density, rock mechanics and fluid sampling. It also offers cased-hole and slick-line services, which provide cement bond evaluation, reservoir monitoring, pipe evaluation, pipe recovery, mechanical services, well intervention perforating, and borehole seismic services. Perforating services contain tubing-conveyed perforating services and products and borehole seismic services constitute fracture analysis and mapping.

LEADING COMPANIES



Testing and subsea services provide acquisition and analysis of dynamic reservoir information and reservoir optimization solutions to the oil and natural gas industry utilizing down-hole test tools, data acquisition services using telemetry and electronic memory recording, fluid sampling, surface well testing, subsea safety systems, and reservoir engineering services.

Software and asset solutions supply integrated exploration, drilling, and production software information systems, as well as consulting and data management services for the upstream oil and gas industry.

The drilling and evaluation segment also provides oilfield project management and integrated solutions to independent, integrated, and national oil companies. These offerings make use of all of the company's oilfield services, products, technologies, and project management capabilities to assist its customers in optimizing the value of their oil and gas assets.

Key Metrics

The company recorded revenues of $17,973 million in the fiscal year ending December 2010, an increase of 22.5% compared to fiscal 2009. Its net income was $1,835 million in fiscal 2010, compared to a net income of $1,145 million in the preceding year.

Table 7: Halliburton Company: key financials ($) $ million 2006 2007 2008 2009 2010Revenues 22,576.0 15,264.0 18,279.0 14,675.0 17,973.0Net income (loss) 2,348.0 3,486.0 2,224.0 1,145.0 1,835.0Total assets 16,820.0 13,135.0 14,385.0 16,538.0 18,297.0Total liabilities 9,444.0 6,269.0 6,660.0 7,781.0 7,910.0Employees 100,000 45,000 51,000 57,000 0 Source: company filings D A T A M O N I T O R

LEADING COMPANIES



Table 8: Halliburton Company: key financial ratios Ratio 2006 2007 2008 2009 2010Profit margin 10.4% 22.8% 12.2% 7.8% 10.2%Revenue growth 7.5% (32.4%) 19.8% (19.7%) 22.5%Asset growth 11.8% (21.9%) 9.5% 15.0% 10.6%Liabilities growth 8.9% (33.6%) 6.2% 16.8% 1.7%Debt/asset ratio 56.1% 47.7% 46.3% 47.0% 43.2%Return on assets 14.7% 23.3% 16.2% 7.4% 10.5% Source: company filings D A T A M O N I T O R

Figure 12: Halliburton Company: revenues & profitability

Source: company filings D A T A M O N I T O R

LEADING COMPANIES



Figure 13: Halliburton Company: assets & liabilities


LEADING COMPANIES



Nabors Industries, Inc.

Table 9: Nabors Industries, Inc.: key facts Head office: Mintflower Place, 8 Par La Ville Road, Hamilton HM 08, BMU Telephone: 441 292 1510 Fax: 441 292 1334 Website: www.nabors.com Financial year-end: December Ticker: NBR Stock exchange: New York Source: company website D A T A M O N I T O R

Nabors Industries (Nabors) is a global land drilling contractor, having oil, gas, and geothermal land drilling operations in 48 states of the lower US, Alaska, Canada, South America, Mexico, the Caribbean, the Middle East, the Far East, Russia and Africa. The company also provides land well-servicing and work-over contract services in the US and Canada.

Nabors operates its business through three operating segments: contract drilling; oil and gas; and other operations.

The contract drilling services include drilling, work-over, and well servicing operations on land and offshore. Nabors provides these services through its offshore platform work-over and drilling rigs, and markets 40 platforms, 13 jack-up units, and three barge rigs in the US and multiple international markets. The company's work-over services provide oil and natural gas companies with services in repair and modifications of oil and natural gas wells. Nabors’ well servicing operations include maintenance services for the mechanical apparatus used to pump or lift oil from oil producing wells. The company owns approximately 558 land work-over and well-servicing rigs in the US and 172 land work-over and well-servicing rigs in Canada and nine rigs in Saudi Arabia.

The oil and gas operating segment of the company makes selective investments in oil and gas exploration, development, and production activities through its Ramshorn business unit in the US, Canada, and internationally.

The other operating segment operates through Nabors' drilling technology subsidiary companies Canrig Drilling Technology, Epoch Well Services, Peak Oilfield Service Company, Peak USA Energy Services, Ryan Energy Technologies, and Nabors Blue Sky.

LEADING COMPANIES



This segment is engaged in the manufacturing of top drives, drilling instrumentation systems, trucking, construction and logistics services, manufacturing and marketing of directional drilling, and rig instrumentation systems.

Canrig Drilling Technology manufactures top drives, which are installed on both onshore and offshore drilling rigs and are marketed throughout the world. Epoch Well Services provides oil and gas well-servicing, work-over and completion, as well as fluid transportation and disposal services. The Peak Oilfield Service Company provides heavy equipment to move drilling rigs, water, other fluids and construction materials, primarily on Alaska's North Slope and in the Cook Inlet region. The company also provides construction and maintenance for ice roads, pads, facilities, equipment, drill sites and pipelines.

Peak USA Energy Services provides hauling and maintenance services for customers in the US Lower 48 states. Ryan Energy Technologies manufactures and sells directional drilling and rig instrumentation and data collection services to oil and gas exploration and service companies. Nabors Blue Sky leases aircraft used for logistics services for onshore drilling in Canada using helicopters and fixed-winged aircraft.

Nabors also offers a wide range of ancillary well-site services, including engineering, transportation, construction, maintenance, well logging, directional drilling, rig instrumentation, data collection, and other support services in select domestic and international markets. It manufactures and leases or sells top drives for a broad range of drilling applications, directional drilling systems, rig instrumentation and data collection equipment, pipeline handling equipment, and rig reporting software. The company serves major oil and gas companies, foreign national oil and gas companies, and independent oil and gas companies.

Key Metrics

The company recorded revenues of $4,175 million in the fiscal year ending December 2010, an increase of 13.3% compared to fiscal 2009. Its net income was $95 million in fiscal 2010, compared to a net loss of $86 million in the preceding year.

LEADING COMPANIES



Table 10: Nabors Industries, Inc.: key financials ($) $ million 2006 2007 2008 2009 2010Revenues 4,707.3 4,938.9 5,511.9 3,683.4 4,174.6Net income (loss) 1,020.7 930.7 551.2 (85.5) 94.7Total assets 9,142.3 10,103.4 10,468.0 10,644.7 11,646.6Total liabilities 5,605.7 5,589.3 5,775.9 5,462.7 6,234.5Employees 25,218 23,965 26,912 0 0 Source: company filings D A T A M O N I T O R

Table 11: Nabors Industries, Inc.: key financial ratios Ratio 2006 2007 2008 2009 2010Profit margin 21.7% 18.8% 10.0% (2.3%) 2.3%Revenue growth 32.6% 4.9% 11.6% (33.2%) 13.3%Asset growth 26.4% 10.5% 3.6% 1.7% 9.4%Liabilities growth 61.4% (0.3%) 3.3% (5.4%) 14.1%Debt/asset ratio 61.3% 55.3% 55.2% 51.3% 53.5%Return on assets 12.5% 9.7% 5.4% (0.8%) 0.8% Source: company filings D A T A M O N I T O R

LEADING COMPANIES



Figure 14: Nabors Industries, Inc.: revenues & profitability


Figure 15: Nabors Industries, Inc.: assets & liabilities


LEADING COMPANIES



Noble Corporation

Table 12: Noble Corporation: key facts Head office: Dorfstrasse 19a, Baar 6340, CHE Telephone: 41 41 761 6555 Fax: 1 281 596 4486 Website: www.noblecorp.com Financial year-end: December Ticker: NE Stock exchange: New York Source: company website D A T A M O N I T O R

The Noble Corporation (Noble) is an offshore drilling contractor for the oil and gas industry. It performs contract drilling services with its fleet of 62 mobile offshore drilling units located in key markets worldwide. The company also offers labor contract drilling services, and engineering and consulting services.

Noble operates through two segments: contract drilling services and other operations.

The contract drilling operations are conducted in the Middle East, India, the US Gulf of Mexico, Mexico, the North Sea, Brazil and West Africa. The company's fleet consists of 13 semisubmersibles, four dynamically positioned drill-ships, 43 jack-ups, and two submersibles. The fleet count also includes two units under construction. As of January, 2010, approximately 87% of the company's fleet was deployed in the Middle East, India, Mexico, the North Sea, Brazil and West Africa.

The other operations segment is comprised of labor contract drilling services, engineering and consulting services, other insignificant operations of the company, and corporate related items.

The company offers services under labor contracts for drilling and work-over activities covering two rigs under a labor contract (the Hibernia Contract) off the east coast of Canada. Under the labor contracts, Noble provides the workforce required to manage and undertake the drilling operations from drilling platforms owned by the operator. The Hibernia Contract extends through January 2013.

Key Metrics

The company recorded revenues of $2,807 million in the fiscal year ending December 2010, a decrease of 22.9% compared to fiscal 2009. Its net income was $773 million in fiscal 2010, compared to a net income of $1,679 million in the preceding year.

LEADING COMPANIES



Table 13: Noble Corporation: key financials ($) $ million 2006 2007 2008 2009 2010Revenues 2,100.2 2,995.3 3,446.5 3,640.8 2,807.2Net income (loss) 731.9 1,206.0 1,561.0 1,678.6 773.4Total assets 4,585.9 5,876.0 7,106.8 8,396.9 11,221.3Total liabilities 1,356.9 1,567.7 1,816.1 1,608.5 3,933.7Employees 5,600 6,000 6,600 6,000 0 Source: company filings D A T A M O N I T O R

Table 14: Noble Corporation: key financial ratios Ratio 2006 2007 2008 2009 2010Profit margin 34.8% 40.3% 45.3% 46.1% 27.6%Revenue growth 52.0% 42.6% 15.1% 5.6% (22.9%)Asset growth 5.5% 28.1% 20.9% 18.2% 33.6%Liabilities growth (16.0%) 15.5% 15.8% (11.4%) 144.6%Debt/asset ratio 29.6% 26.7% 25.6% 19.2% 35.1%Return on assets 16.4% 23.1% 24.0% 21.7% 7.9% Source: company filings D A T A M O N I T O R

LEADING COMPANIES



Figure 16: Noble Corporation: revenues & profitability


Figure 17: Noble Corporation: assets & liabilities


LEADING COMPANIES



Transocean Ltd.

Table 15: Transocean Ltd.: key facts Head office: Blandonnet International Business Center, Chemin de Blandonnet 2,

Building F 7th Floor, Vernier 1214, CHE Telephone: 41 2 2930 9000 Website: www.deepwater.com Financial year-end: December Ticker: RIG, RIGN Stock exchange: New York, SIX Swiss Source: company website D A T A M O N I T O R

Transocean is a provider of offshore contract drilling services for oil and gas wells across the world. Transocean's primary activity is to contract drilling rigs, related equipment, and work crews to drill oil and gas wells on a day-rate basis. The company also specializes in other technical aspects such as offshore drilling with a particular focus on deepwater and harsh environment drilling services. The company also provides oil and gas drilling management services on either a day-rate basis or a completed-project, fixed-price basis, as well as drilling engineering and drilling project management services and participates in oil and gas exploration and production activities.

Transocean principally uses three types of drilling rigs: drill ships, semi submersibles, and jack-ups. The company also operates barge drilling rigs and a coring drillship.

The company conducts its business through two reportable operating segments: contract drilling and other operations.

The contract drilling segment consists of floaters, jack-ups, and other rigs used in support of offshore drilling activities and offshore support services on a worldwide basis. The company categorized its fleet into five types: high-specification floaters (consisting of ultra-deepwater floaters, deepwater floaters, and harsh environment floaters), mid-water floaters, high-specification jack-ups, standard jack-ups and other rigs.

As of February 2010, the company owned, had partial ownership interests in, or operated 138 mobile offshore drilling units. As of the same date, the company's fleet consisted of 44 high-specification floaters (comprised of 23 ultra-deepwater floaters, 16 deepwater floaters, and five harsh environment floaters), 26 mid-water floaters, 10 high-specification jack-ups, 55 standard jack-ups, and three other rigs (comprised of two barge drilling rigs and one coring drillship). The company also has five ultra-deepwater floaters under construction.

LEADING COMPANIES



Other operations include drilling management services and oil and gas properties. The company provides drilling management services primarily on a turnkey basis through a wholly-owned subsidiary, Applied Drilling Technology, which primarily operates in the US Gulf of Mexico, and through ADT International, a division of one of the company's UK subsidiaries, which primarily operates in the North Sea.

As part of its turnkey drilling services, Transocean provides planning, engineering, and management services. In addition to turnkey drilling services, the company also participates in project management operations that include providing certain planning, management and engineering services, purchasing equipment, and providing personnel and other logistical services to its customers.

The company also provides well and logistics services in addition to its normal drilling services through third party contractors and its employees. These services, known as integrated services, are subject to individual contractual agreements executed to meet specific customer needs and are provided either at a day-rate, cost plus or fixed-price basis.

Transocean also conducts oil and gas exploration, development, and production activities through Challenger Minerals and Challenger Minerals (North Sea) (collectively, CMI), the company's oil and gas subsidiaries. The subsidiaries hold property interests in the US offshore Louisiana and Texas and in the UK sector of the North Sea.

Transocean has several joint venture drilling companies, principally in Angola, India, Indonesia, Malaysia and Nigeria. Transocean holds a 50% interest in Transocean Pacific Drilling (TPDI), a British Virgin Islands joint venture company formed with Pacific Drilling Limited, a Liberian company. It also holds a 65% interest in the Angola Deepwater Drilling Company (ADDCL), a Cayman Islands joint venture company formed to construct, own, and operate an ultra-deepwater drillship to be named Discoverer Luanda. In addition, it has a 50% interest in Overseas Drilling (ODL), an unconsolidated Cayman Islands joint venture company, which owns the drillship Joides Resolution.

Transocean provides offshore drilling services to most of the leading international oil companies (or their affiliates) and government-controlled and independent oil companies. One of the major clients of Transocean for FY2009 was BP, which accounted for 12% of its operating revenues.

Key Metrics

The company recorded revenues of $9,576 million in the fiscal year ending December 2010, a decrease of 17.1% compared to fiscal 2009. Its net income was $961 million in fiscal 2010, compared to a net income of $3,181 million in the preceding year.

LEADING COMPANIES



Table 16: Transocean Ltd.: key financials ($) $ million 2006 2007 2008 2009 2010Revenues 3,882.0 6,377.0 12,674.0 11,556.0 9,576.0Net income (loss) 1,385.0 3,121.0 4,031.0 3,181.0 961.0Total assets 11,476.0 34,364.0 35,171.0 36,436.0 36,811.0Total liabilities 4,640.0 21,793.0 18,015.0 15,877.0 15,411.0Employees 10,700 21,100 21,600 0 0 Source: company filings D A T A M O N I T O R

Table 17: Transocean Ltd.: key financial ratios Ratio 2006 2007 2008 2009 2010Profit margin 35.7% 48.9% 31.8% 27.5% 10.0%Revenue growth 34.2% 64.3% 98.7% (8.8%) (17.1%)Asset growth 9.7% 199.4% 2.3% 3.6% 1.0%Liabilities growth 87.5% 369.7% (17.3%) (11.9%) (2.9%)Debt/asset ratio 40.4% 63.4% 51.2% 43.6% 41.9%Return on assets 12.6% 13.6% 11.6% 8.9% 2.6% Source: company filings D A T A M O N I T O R

LEADING COMPANIES



Figure 18: Transocean Ltd.: revenues & profitability


Figure 19: Transocean Ltd.: assets & liabilities


MARKET FORECASTS



MARKET FORECASTS

Market value forecast

In 2015, the global oil & gas drilling sector is forecast to have a value of $124.5 billion, an increase of 52.1% since 2010.

The compound annual growth rate of the sector in the period 2010–15 is predicted to be 8.7%.

Table 18: Global oil & gas drilling sector value forecast: $ billion, 2010–15 Year $ billion € billion % Growth2010 81.9 61.7 36.7%2011 99.7 75.1 21.8%2012 105.5 79.4 5.8%2013 117.3 88.3 11.2%2014 123.7 93.1 5.4%2015 124.5 93.7 0.6%

CAGR: 2010–15 8.7%


Figure 20: Global oil & gas drilling sector value forecast: $ billion, 2010–15


MARKET FORECASTS



Market volume forecast

In 2015, the global oil & gas drilling sector is forecast to have a volume of 678.5 million feet, an increase of 18.6% since 2010.

The compound annual growth rate of the sector in the period 2010–15 is predicted to be 3.5%.

Table 19: Global oil & gas drilling sector volume forecast: million feet, 2010–15 Year million feet % Growth2010 572.0 32.4%2011 549.5 (3.9%)2012 619.2 12.7%2013 644.1 4.0%2014 669.4 3.9%2015 678.5 1.4%

CAGR: 2010–15 3.5%


Figure 21: Global oil & gas drilling sector volume forecast: million feet, 2010–15


APPENDIX



APPENDIX

Methodology

Datamonitor Industry Profiles draw on extensive primary and secondary research, all aggregated, analyzed, cross-checked and presented in a consistent and accessible style.

Review of in-house databases – Created using 250,000+ industry interviews and consumer surveys and supported by analysis from industry experts using highly complex modeling & forecasting tools, Datamonitor’s in-house databases provide the foundation for all related industry profiles

Preparatory research – We also maintain extensive in-house databases of news, analyst commentary, company profiles and macroeconomic & demographic information, which enable our researchers to build an accurate market overview

Definitions – Market definitions are standardized to allow comparison from country to country. The parameters of each definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the market and our clients

Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and trends

Datamonitor aggregates and analyzes a number of secondary information sources, including: - National/Governmental statistics - International data (official international sources) - National and International trade associations - Broker and analyst reports - Company Annual Reports - Business information libraries and databases

Modeling & forecasting tools – Datamonitor has developed powerful tools that allow quantitative and qualitative data to be combined with related macroeconomic and demographic drivers to create market models and forecasts, which can then be refined according to specific competitive, regulatory and demand-related factors

Continuous quality control ensures that our processes and profiles remain focused, accurate and up-to-date

APPENDIX



Industry associations

Energy Information Administration

1000 Independence Avenue, SW Washington, DC 20585, US Tel.: 001 202 586 8800 Fax: 001 202 586 9753 http://www.eia.doe.gov

Related Datamonitor research

Industry Profile

Global Oil & Gas Equipment & Services

Global Energy Equipment & Services

Global Oil & Gas Exploration & Production

Global Oil & Gas Refining & Marketing

APPENDIX



Disclaimer

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