Baker Hughes 2004 Annual Report Download - page 14
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opportunitiesacrosstheenterprise
competeforfundingandarerankedon
thebasisofrisk-adjustedreturn.Through
ourProductDevelopmentManagement
process,weevaluateallpotentialnew
productsbothfortheirtechnicalmerit
andfortheirabilitytogenerateade-
quatereturns.
Becausetheoilfieldservicebusinessis
cyclical,itispronetoperiodsofovercapac-
ity,makingitdifficulttoobtainfairpricing
inrelationtothevaluewecreateforour
clients.Wewillcontinuetoexercisecau-
tioninaddingcapacity,andwilldoso
onlywhenneededtomeetlong-term
marketdemand.
Outlook
Althoughweseeoilpricesmoderat-
ingfromthehighlevelsseenin2004,we
expectworldwideoildemandtocontinue
toincrease2-3%thisyear.Inaddition,
weexpectourclientstoincreasetheir
upstreamspendingprogramsby9-12%
in2005.
Demandfornaturalgaswillcontinueto
supportrelativelyhighlevelsofland-based
drillinginNorthAmerica.Wealsoexpect
higherlevelsofactivityintheGulfof
Mexicoasdeepwaterdevelopmentpro-
ceedsandintheNorthSeawhereinde-
pendentsarerampingupoperations.We
expecttotalinternationalactivitytobeup
9-11%in2005.
Overall,weareoptimisticabout2005.
BakerHughesiswell-positionedtocapital-
izeonopportunitieswherevertheyarise.
MikeWileyRetires
MichaelE.Wileyretiredfromhis
positionasChairmanandCEOofBaker
HughesonOctober25,2004.Mikecame
toBakerHugheswithauniquevision,and
underhisdirectionthecompanyadopted
ourCoreValuesanddevelopedthelong-
termstrategiesthatsetthecourseforthe
company.WethankMikeforhiswise
counsel,hisdedicationandhisstrong
leadership.Wewishhimthebestinhis
futureendeavors.
Inclosing,Iwouldliketothankour
customersandouremployeesformaking
2004ayearofrecordsuccessforBaker
Hughes.Thisorganizationisastrongtech-
nologyleader,whosesuccessisdrivenby
professionalswhoarededicatedtoour
customers.IamproudtobepartofBaker
Hughes,andIlookforwardtothechal-
lengesandopportunitiesthatlieahead.
ChadC.Deaton
ChairmanandChiefExecutiveOfficer
Seated:(l-r)ChadC.Deaton,ChairmanandCEO;AlanR.Crain,Jr.,V.P.andGeneralCounsel.Standing:
(l-r)GregNakanishi,V.P.HumanResources;JamesR.Clark,PresidentandCOO;G.StephenFinley,Sr.V.P.
FinanceandAdministrationandCFO.
10BakerHughesIncorporated