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International Conference on Services and Equipment for the Russian Oil & Gas Industry

International Conference on Services and Equipment for the Russian Oil & Gas Industry. Session 5 Competition & Russian Oil Field Services December 3rd 2003.

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International Conference on Services and Equipment for the Russian Oil & Gas Industry

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  1. International Conference on Services and Equipment for the Russian Oil & Gas Industry Session 5 Competition & Russian Oil Field Services December 3rd 2003

  2. Price Value Added Competition & Competitive Advantages Market for Technology can all be discussed philosophicallybut the real world is the real world

  3. Case of 3D Sesimic Value “Migration” The value of this technology to the Oil Companies has been billions of Dollars Meanwhile the Seismic companies themselves are losing money

  4. The Oil & Gas reserves of the Russian Federation certainly represent a huge opportunity (at least for Oil Companies) But what kind of opportunity does it realistically represent for Service Companies? (Russian or Foreign)

  5. Market size estimates of some selected oilfield products & services (Rigs/Drilling does fully not include Oil Company “in house” Service Organizations) $ Millions

  6. A view on Pricing & Competitive Advantage

  7. Clients benefit from these differences Service Companies spending more in these areas expect enhanced profitability for extra value delivered

  8. If desired technologies are not available locally then some differential is inevitable

  9. The numbers LUKoil compares Shows for Parker Drilling a net (assets minus debt) investment of 584 million generating a “sales” profit of 11 million So the return in 2001 is 1.88% A saving account pays more with less risk

  10. Future Expectations • Relative prices of Russian and Western Service companies will converge over time • Differentiation in technology between Russian and Foreign services will decrease • Some In-house service organizations will be sold off or divested while others will become more separated and independent but will remain under the control of the oil companies • The total market for Oil Field Services in the will grow about 20% (in $ terms) over the next 5 years

  11. Thank you!

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