- The Washington Times - Sunday, March 11, 2007

From combined dispatches

DUBAI, United Arab Emirates Oil services giant Halliburton Co. will soon shift its corporate headquarters from Houston to the Middle East financial powerhouse of Dubai, Chief Executive Officer Dave Lesar announced yesterday.

Mr. Lesar, speaking at an energy conference in nearby Bahrain, said he will relocate to Dubai from Texas to oversee Halliburton’s intensified focus on business in the Middle East and energy-hungry Asia, home to some of the world’s most important oil and gas markets.

“As the CEO, I’m responsible for the global business of Halliburton in both hemispheres, and I will continue to spend quite a bit of time in an airplane as I remain attentive to our customers, shareholders and employees around the world,” Mr. Lesar said. “Yes, I will spend the majority of my time in Dubai.”

Mr. Lesar’s announcement signals one of the highest-profile moves by a U.S. corporate leader to Dubai, an Arab boomtown where free-market capitalism has been paired with some of the world’s most liberal tax, investment and residency laws.

“Growing our business here will bring more balance to Halliburton’s overall portfolio,” said Mr. Lesar, 53. “This is a market that is more heavily weighted toward oil exploration and production opportunities.”

More than 38 percent of Halliburton’s $13 billion oil field services revenue last year was derived from sources in the Eastern Hemisphere, where the company has 16,000 of its 45,000 employees.

The move is part of an effort to shift business outside North America, which provided 55 percent of Halliburton’s profit last quarter, and to court national oil companies that pump most of the oil in the Middle East.

Dubai is on the Persian Gulf and is part of the United Arab Emirates, the fourth-biggest crude oil producer in the Organization of Petroleum Exporting Countries.

Concern that lower natural gas prices in North America might trim profits helped push down Halliburton’s stock 4.4 percent over the past year. Rival Schlumberger Ltd., the world’s largest provider of oil field services, rose 11 percent in the same period, helped by its emphasis on oil drilling for non-U.S. companies.

North America accounted for $525 million of Halliburton’s $959 million fourth-quarter profit from oil field services. In North America, the number of rigs drilling for natural gas in the quarter rose 5.2 percent.

Profit from international operations rose 49 percent in the fourth quarter from a year earlier to $434 million. Europe, Africa and former Soviet states accounted for the bulk of Halliburton’s earnings outside North America.

Halliburton said that the Dubai headquarters was part of a strategy, adopted last year, to boost its customer relations with national oil companies.

Mr. Lesar said last year that many national oil companies no longer needed partnerships with companies such as Exxon Mobil Corp. that traditionally managed projects.

Halliburton and other oil-field-services companies can provide much of the technology and expertise that the international oil companies controlled in the past, Mr. Lesar said.

“The national oil companies have gotten much more sophisticated in terms of the types of projects they believe they can take on,” Mr. Lesar said. Because of that, he said, “our customer base is changing a bit.”

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