Halliburton 2011 Annual Report Download - page 62

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47
BUSINESS ENVIRONMENT AND RESULTS OF OPERATIONS
We operate in approximately 80 countries throughout the world to provide a comprehensive range
of discrete and integrated services and products to the energy industry. The majority of our consolidated
revenue is derived from the sale of services and products to major, national, and independent oil and natural
gas companies worldwide. We serve the upstream oil and natural 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.
Our two business segments are the Completion and Production segment and the Drilling and Evaluation
segment. The industry we serve is highly competitive with many substantial competitors in each segment.
In 2011, based upon the location of the services provided and products sold, 55% of our consolidated
revenue was from the United States. In 2010, 46% of our consolidated revenue was from the United States.
No other country accounted for more than 10% of our revenue during these periods.
Operations in some countries may be adversely affected by unsettled political conditions, acts of
terrorism, civil unrest, force majeure, war or other armed conflict, expropriation or other governmental
actions, inflation, foreign currency exchange restrictions, and highly inflationary currencies. We believe the
geographic diversification of our business activities reduces the risk that loss of operations in any one
country, other than the United States, would be materially adverse to our consolidated results of operations.
Activity levels within our business segments are significantly impacted by spending on upstream
exploration, development, and production programs by major, national, and independent oil and natural gas
companies. Also impacting our activity is the status of the global economy, which impacts oil and natural
gas consumption.
Some of the more significant measures of current and future spending levels of oil and natural gas
companies are oil and natural gas prices, the world economy, the availability of credit, government
regulation, and global stability, which together drive worldwide drilling activity. Our financial performance
is significantly affected by oil and natural gas prices and worldwide rig activity, which are summarized in
the following tables.
This table shows the average oil and natural gas prices for West Texas Intermediate (WTI), United
Kingdom Brent crude oil, and Henry Hub natural gas:
Average Oil Prices (dollars per barrel) 2011 2010 2009
West Texas Intermediate $ 95.13 $ 79.36 $ 61.65
United Kingdom Brent $111.53 $ 79.66 $ 61.49
Average United States Natural Gas Prices (dollars per thousand
cubic feet, or Mcf)
Henry Hub $ 4.09 $ 4.52 $ 4.06