Schlumberger Announces First-Quarter 2012 Results

Schlumberger Limited (NYSE:SLB) today reported first-quarter 2012
revenue of $10.61 billion versus $10.97 billion in the fourth quarter of
2011, and $8.72 billion in the first quarter of 2011.

Net income attributable to Schlumberger, excluding charges and credits,
was $1.31 billion?a decrease of 12% sequentially but an increase of 35%
year-on-year. Diluted earnings-per-share, excluding charges and credits,
was $0.98 versus $1.11 in the previous quarter, and $0.71 in the first
quarter of 2011.

Schlumberger recorded charges of $0.01 per share in the first quarter of
2012 versus $0.06 per share in the previous quarter, and $0.02 per share
in the first quarter of 2011.

Oilfield Services revenue of $9.92 billion decreased 4% sequentially but
increased 22% year-on-year. Pretax segment operating income of $1.94
billion was down 10% sequentially but increased 33% year-on-year.

Distribution revenue of $713 million increased 4% sequentially and 19%
year-on-year. Pretax segment operating income of $35 million increased
32% sequentially and 56% year-on-year.

Schlumberger CEO Paal Kibsgaard commented, 'While revenue fell as a
result of the normal seasonal slowdown in product, software and
multiclient sales, our first-quarter results showed good progress driven
by global exploration and deepwater activity underpinned by strong
execution and operational excellence.

Excluding seasonal sales effects, North America revenue was flat
sequentially. On land, the move of rigs and service capacity from
gas-rich to liquids-rich basins accelerated. Subsequently, the pricing
weakness already experienced in the previous quarters also reached the
liquids-rich basins. Offshore, increased drilling and deepwater
exploration activity in the US Gulf of Mexico contributed positively to
results.

Internationally, the normal impact of winter weather and year-end sales
effects lowered revenue, but growing higher-margin exploration and
deepwater activity in a number of regions, as well as strong execution
in all parts of the business, kept margins flat sequentially. Land
activity remained strong in the Middle East and North Africa.

Bidding remained competitive on large tenders for standard technology.
However, pricing sentiments are starting to move upwards as the majority
of the large international contracts have now been re-bid and service
capacity is tightening further.

WesternGeco saw a strong first quarter in marine seismic. Capacity for
the coming quarters is filling fast, driven by higher activity in West
Africa, the North Sea, the Arctic, and Brazil. Backlog increased during
the quarter, and pricing is trending upwards.

While uncertainties linked to global financial markets and potential
geopolitical events remain, the risk of a double-dip global recession
has declined. Oil demand in 2012 appears to have stabilized, and supply
continues to be limited by weak non-OPEC performance and narrow spare
capacity margins. These effects should limit any oil-price decline. In
the US, natural gas storage and abundant supply have led to weakening
natural gas activity with little likelihood of short-term recovery.
International gas prices however, remain solid, driven by strong demand.

We maintain our positive view on the international markets and expect
the rig count to grow by more than 10% in 2012 through strength in
exploration and deepwater activity as well as in key land markets.
Strong execution, solid contracts and rich new technologies provide the
foundation upon which we will capitalize. In North America, we remain
more cautious until the uncertainties around the dry gas drilling and
pressure pumping pricing outlook become clearer. However, with a
balanced land portfolio and strong deepwater leverage, we remain
favorably positioned to outperform even in this market.?

Other Events:

• 
  During the quarter, Schlumberger repurchased 4.4 million shares of its
  common stock at an average price of $74.01 for a total purchase price
  of $324 million.
  
• 
  On March 5, 2012, WesternGeco announced the formation of a new
  division to sell and lease the UniQ* integrated point-receiver land
  seismic system to other service companies as well as to energy
  companies that maintain their own crews.
  
• 
  On March 20, 2012, Schlumberger announced that it had entered into a
  purchase agreement to acquire SPT Group?a privately owned software
  company based in Norway specializing in dynamic modeling for the oil
  and gas industry. The acquisition is subject to various conditions,
  including customary regulatory approvals, and is expected to close in
  the second quarter of 2012.
  
• 
  On April 10, 2012, Schlumberger announced that it had entered into an
  agreement with National Oilwell Varco, Inc. to sell its Wilson
  distribution business. Closing of the transaction is subject to
  various conditions, including customary regulatory approvals.
  

Net Debt

'Net Debt? represents gross debt less cash, short-term investments and
fixed income investments, held to maturity. Management believes that Net
Debt provides useful information regarding the level of Schlumberger′s
indebtedness by reflecting cash and investments that could be used to
repay debt. Details of changes in Net Debt for the year to date follow:

Charges and Credits

In addition to financial results determined in accordance with US
generally accepted accounting principles (GAAP), this first-quarter
press release also includes non-GAAP financial measures (as defined
under the SEC′s Regulation G). The following is a reconciliation of
these non-GAAP measures to the comparable GAAP measures:

Oilfield Services

First-quarter revenue of $9.92 billion decreased 4% sequentially but
increased 22% year-on-year. The strong seasonal product, software and
multiclient sales experienced in the fourth quarter of 2011 accounted
for approximately two-thirds of the sequential decrease in revenue in
the first quarter of 2012. The transition of Well Services activities
from gas-rich to liquids-rich basins in North America also impacted
results as reduced fleet utilization and new industry capacity additions
led to competitive pricing declines. The effect of this transition was
offset, however, by stronger winter exploration in Western Canada and
Alaska and increased deepwater activity in the US Gulf of Mexico.
Excluding seasonality effects, international activity continued to show
signs of strength, particularly in deepwater and exploration activities
in Sub-Saharan Africa and Latin America.

Reservoir CharacterizationGroup revenue decreased
primarily on lower WesternGeco multiclient and Schlumberger Information
Solutions (SIS) software sales following the fourth quarter of 2011
seasonal highs, but these effects were partially offset by higher
WesternGeco marine acquisition activity. DrillingGroup
revenue was flat as higher M-I SWACO sales in North America land,
increasing deepwater activity in the US Gulf of Mexico, and robust
international activity across the Group were offset by lower Integrated
Project Management (IPM) operations in the Mexico & Central America and
Iraq GeoMarkets. ProductionGroup revenue decreased
sequentially on lower Well Services pricing and fleet utilization in
North America land, the effect of seasonally strong Artificial Lift and
Completions Systems equipment sales experienced in the fourth quarter of
2011, and lower Framo and Schlumberger Production Management activities.

On a geographical basis, North America Area revenue decreased due
to lower WesternGeco multiclient sales following the seasonally strong
fourth-quarter 2011 results. Excluding this impact, revenue was flat
sequentially as the decline in US land was partially offset by the
stronger winter exploration activity in Western Canada and Alaska,
although the effect in Canada was muted by the very early spring
break-up. Area revenue also benefited from increased drilling and
deepwater exploration activity in the US Gulf of Mexico. In the Latin
America Area, revenue declined in the Mexico & Central America
GeoMarket from lower IPM project activities; in the Peru, Colombia &
Ecuador GeoMarket from the effect of the strong product sales seen in
the fourth quarter of 2011; and in the Brazil GeoMarket from reduced
WesternGeco multiclient sales. These declines, however, were partially
offset by higher WesternGeco marine activity in the Venezuela, Trinidad
& Tobago GeoMarket and higher shale-related activity that benefited Well
Services, Wireline and M-I SWACO in the Argentina, Bolivia and Chile
GeoMarket. In the Europe/CIS/Africa Area, revenue decreased
following the seasonally strong product and software sales of the fourth
quarter of 2011, and sluggish winter activity in Russia and the North
Sea GeoMarket. Excluding these seasonal impacts, Area revenue grew
sequentially due to strong exploration activities in the Southern and
Eastern Africa GeoMarket; a continued resumption of activities in the
Libya GeoMarket; and robust M-I SWACO sales in the Nigeria and Gulf of
Guinea Africa GeoMarket. In the Middle East & Asia Area,
revenue decreased from the effect of seasonally strong product and
software sales in the fourth quarter of 2011. Reduced IPM project
activity in Iraq and the shutdown of operations in Syria and South Sudan
also contributed to this decline although the effect was largely
mitigated by increased activity in the East Asia GeoMarket following the
monsoon-related slowdowns of the fourth quarter of 2011.

First-quarter pretax operating income of $1.94 billion decreased 10%
sequentially but increased 33% year-on-year. Pretax operating margin
decreased 147 basis points (bps) sequentially to 19.6% primarily due to
the reduced software and product sales as well as to the lower
WesternGeco multiclient sales. North America pretax operating
margin decreased 409 bps sequentially to 22.8% from lower WesternGeco
multiclient sales and reduced Well Services asset utilization and
pricing. International pretax operating margin was flat at 19.1%
despite the significant impact of the fourth-quarter 2011 product,
software and multiclient sales, and the seasonal drop in Russia and the
North Sea during the first quarter of 2012. Excluding seasonality, the
increase in high- margin exploration and deepwater activities helped
sustain robust international margins.

A number of significant contracts won during the quarter highlighted
recent technology portfolio developments. These included awards for IPM,
Schlumberger Production Management and Framo, as well as for products
and services across the portfolio.

In Saudi Arabia, Schlumberger has been awarded a 10-well contract for
the well logging, slickline, proppant fracturing, well testing,
coiled-tubing and nitrogen services required for the development of
unconventional tight and shale gas resources in a remote area with
limited infrastructure. The scope of work includes multistage shale and
tight sandstone targets and Schlumberger will provide all engineering,
equipment, materials, services, transportation, storage, accommodations
and logistics.

In Argentina, YPF awarded Schlumberger a contract to provide integrated
services for shale completions in the Neuquen province. The contract
covers pressure pumping, cased-hole wireline, drillable bridge and
fracture plug, fracture plug drillout and flowback, coiled-tubing and
integrated project management services. This is the first fully
dedicated shale completions crew in Latin America and has so far
performed more than 100 treatments in the Vaca Muerta shale.

In South Mexico, PEMEX E&P has awarded Schlumberger Production
Management a 25-year contract to evaluate, develop and produce
hydrocarbons in the Carrizo field. The contract is focused on increasing
reservoir recovery through a commercial model based on incremental oil
production. Schlumberger expertise in project and asset management,
subsurface knowledge, well construction, production engineering and
technology will be applied to address field redevelopment and the use of
thermal processes and technologies to develop the field's heavy oil
resources.

In Ecuador, EP PETROECUADOR has awarded Schlumberger Production
Management and its partners two 15-year service contracts to redevelop
and rejuvenate the Shushufindi and Libertador fields located in the
Oriente region of Ecuador. Schlumberger leads the Shushufindi field
consortium with Tecpetrol Corporation and Kohlberg Kravis Roberts as
partners, and holds a share in the Libertador field consortium, which is
led by Tecpetrol and includes Canacol Energy Ltd. and Sertecpet as
partners. Both contracts are based on a commercial model that rewards
investment based on incremental oil production and also provide for
selected improved and enhanced recovery techniques on an experimental
basis that, if successful, have the potential to further rejuvenate the
fields.

In Brazil, IPM extended its service agreements to continue support of
OGX offshore exploration and development campaigns. The scope of work
will continue to span all Schlumberger Technologies. These include the
FlexSTIM* modular offshore stimulation vessel as well as the subsea
completion installation services that will be used to install more than
10 subsea trees over the duration of the project.

Also in Brazil, BP has extended its contracts with Schlumberger for a
broad selection of technologies to support deepwater development of the
Polvo field in the Campos basin as well as ongoing exploration drilling.
The extension includes a wide range of Drilling & Measurements,
Wireline, M-I SWACO, Geoservices, Well Services, and Artificial Lift
technologies.

Elsewhere in Brazil, Petrobras has awarded WesternGeco the largest share
of a three-year data processing contract that includes a full portfolio
of leading-edge depth imaging algorithms for land and marine seismic
data. The work will be executed in the WesternGeco GeoSolutions data
processing facility in the Schlumberger Brazil Research and
Geoengineering Center located in Rio de Janeiro.

Additionally in Brazil, Schlumberger Artificial Lift has been awarded a
five-year extendable contract for the deepwater heavy oil Papa-Terra
field in the Campos basin for 23 electrical submersible pumps, 8 of
which will operate on subsea wellheads. Four-pump configurations will be
installed using REDA Maximus* electrical submersible pump technology.

On the Alaska North Slope, Schlumberger has been awarded the wireline
logging services contract for the Repsol E&P USA Inc. three-rig program.
A number of advanced technologies form part of the contract, including
Rt Scanner* triaxial induction, PressureXpress* reservoir pressure while
logging and MDT* modular formation dynamics tester services. The award
was based on Schlumberger technological expertise and extensive North
Slope infrastructure.

In Canada, Chevron contracted WesternGeco for the first Q-Marine*
point-receiver marine seismic survey in the Beaufort Sea for the 2012
summer season. WesternGeco has proven seismic acquisition experience in
the area′s harsh arctic conditions and also offers the use of
environmentally friendly technologies that include the Q-Marine Solid*
streamer with nonfluid fill.

Offshore Norway, Framo has been awarded a contract by Statoil to design
and build a gas-compression plant for the Gullfaks field. The plant, one
of the world's first subsea gas compression systems, is expected to help
increase field recovery by boosting reservoir pressure and builds on the
unique technology position of Framo.

Reservoir Characterization Group

First-quarter revenue of $2.59 billion was 7% lower sequentially but
increased 18% year-on-year. Pretax operating income of $672 million was
14% lower sequentially but increased 46% year-on-year.

Sequentially, revenue decreased primarily on lower WesternGeco
multiclient and SIS software sales following their fourth-quarter 2011
seasonal highs, but these effects were partially offset by increased
WesternGeco marine acquisition on higher vessel utilization. Wireline
revenue was flat as strong activity in the North America and Latin
America Areas was offset by slowdowns in the Europe/CIS/Africa and
Middle East & Asia Areas due to weather and seasonality. Excluding
seasonality, the Group grew on stronger deepwater and exploration
activity in Sub-Saharan Africa, Latin America and the US Gulf of Mexico.

Pretax operating margin decreased 189 bps sequentially to 26% primarily
due to the seasonally lower WesternGeco multiclient and SIS software
sales but this effect was partially mitigated by higher WesternGeco
vessel utilization on lower marine transits. Excluding seasonality,
margins improved through deepwater and exploration activities and better
WesternGeco vessel utilization.

Technology successes for the Group′s services and products focused on
exploration and deepwater operations as well as on enhanced reservoir
understanding in unconventional resource development.

Offshore Liberia, advanced Wireline logging technologies were deployed
for African Petroleum in a deepwater exploration well to evaluate a
series of finely laminated and thin-bedded reservoirs. The technologies
included the Rt Scanner triaxial induction service, the ECS* elemental
capture spectroscopy sonde, and the CMR* combinable magnetic resonance
tool. The data were analyzed using Thin Beds Advisor* petrophysical
evaluation for clastic reservoirs that led to more accurate hydrocarbon
volumes and guided an optimal formation pressure testing and fluid
sampling program. Other Schlumberger technology deployed on this project
included Drilling & Measurements directional drilling and
logging-while-drilling services.

In Nigeria, Wireline MR Scanner* expert magnetic resonance technology
helped Addax Petroleum Development Nigeria Limited distinguish potential
oil-bearing reservoirs from water zones in an onshore exploration well.
The well had been drilled through a succession of high-quality stacked
sandstone formations in an area of fresh reservoir waters that rendered
saturations difficult to determine with conventional resistivity
methods. The multiple depth-of-investigation scanning capability of the
MR Scanner service identified the nature of the reservoir fluids and
enabled Addax to avoid testing the water-bearing levels.

Schlumberger Testing Services technology has been deployed on a
deepwater well in the US Gulf of Mexico in record water depths for the
SenTREE* high-pressure subsea test tree and SenTURIAN* subsea landing
string electrohydraulic operating systems. As part of the completion,
the operator also used Schlumberger PowerFlow* slug-free big hole shaped
charges, deepwater IRIS* intelligent remote implementation system
valves, a longstroke 9 5/8-in packer, and the PURE* perforating system
for clean perforations.

In a well in the Marcellus Shale, Schlumberger Wireline acquired
multiple borehole seismic data sets that included vertical seismic,
offset seismic and walkaway seismic profiles together with a 27-position
walkaround survey. The seismic profiles were recorded using 12-shuttle
VSI* versatile seismic imager technology with vibrator seismic sources
with the data being used to calibrate and enhance surface seismic data
to provide better understanding of this unconventional reservoir.

Offshore Trinidad and Tobago, WesternGeco completed the first phase of a
project for BP that included a Q-Seabed* multicomponent seabed seismic
system with simultaneous source acquisition. WesternGeco also won a
multiyear agreement with BP for the acquisition of a 4D Q-Marine
point-receiver seismic survey in the Valhall field of the southern North
Sea. This marks the third season that WesternGeco has acquired seismic
data for BP in the North Sea.

WesternGeco has introduced the ObliQ* sliding-notch broadband
acquisition and imaging solution?a new marine technique that optimizes
the recorded bandwidth of the seismic signal by utilizing a variable
depth cable. The technique can be employed with all types of survey
design, including both narrow- and wide-azimuth acquisition as well as
Coil Shooting* single-vessel full-azimuth geometries. The
ultra?low-frequency system response of the Q?Marine point-receiver
seismic system when combined with the proprietary deghosting solution
ensures high?fidelity recording of the bandwidth extension towards the
low frequencies enabled by the ObliQ solution.

In the US Gulf of Mexico, WesternGeco has begun acquisition of the
Revolution IV multiclient survey. This multivessel Dual Coil Shooting*
multivessel full-azimuth acquisition in the Alaminos Canyon area follows
the March 2012 completion of the Revolution III survey which used the
same technology to acquire data in the Keathley Canyon area.

In Western Australia, new Wireline ReSOLVE Family* instrumented wireline
intervention services were deployed using the TuffTRAC* cased hole
services tractor to overcome operational challenges in a highly deviated
offshore well. These included setting a plug at 5,200 m in a section
deviated at 85 ?, positioning a debris catcher at 5,200 m and setting an
isolation sleeve at 500 m under 17 ? deviation. The ability of the
technology to successfully perform these mechanical services avoided
mobilization of a separate slickline crew, saving about 16 hours of rig
time. This was the first worldwide application of TuffTRAC
tractor-conveyed ReSOLVE* services in a single trip to the wellsite.

Drilling Group

First-quarter revenue of $3.78 billion was flat sequentially but 22%
higher year-on-year. Pretax operating income of $657 million was 1%
higher sequentially and increased 42% year-on-year.

Sequentially, revenue was flat as higher M-I SWACO sales in North
America land, increasing deepwater activity in the US Gulf of Mexico,
and robust international activity across the Group were offset by lower
IPM activity in the Mexico & Central America and Iraq GeoMarkets.
Drilling & Measurements revenue slipped marginally due to winter weather
in Russia, although this was partially offset by higher activities in
the Latin America and Middle East and Asia Areas. Bits and Advanced
Technologies revenue decreased slightly due to the effect of the
seasonal product sales experienced in the fourth quarter of 2011.

Sequentially, pretax operating margin increased 28 bps to 17.4% due to
stronger M-I SWACO pricing in North America land, the Group′s increasing
high-margin deepwater activity in North America, and an increased
international footprint for former Smith Technologies.

A number of Drilling Group technologies contributed to the
first-quarter′s results.

Advanced Drilling & Measurements services have been deployed offshore
Australia to position a well in challenging geology rendered complex by
thin unconsolidated sands, compartmentalized shallow oil-water contacts,
and marine erosional surfaces that required high rates of penetration to
maintain directional control. The combination of PowerDrive Archer*
high-build-rate rotary steerable systems and PeriScope* bed boundary
mapper technology enabled 8 1/2-in multilateral wells to be positioned
within 1 to 2 m of the reservoir top avoiding any crossing of the
oil-water contact that would have necessitated a redrill. Overall
drilling time was reduced by one-third compared to previous bottomhole
assembly configurations.

In the South China Sea, the CACT Operators Group, consisting of CNOOC,
Chevron and Eni, deployed Drilling & Measurements StethoScope* formation
pressure-while-drilling technology in a pilot directional well to
evaluate depletion in a mature reservoir before drilling and completing
a new sidetrack. The data helped select the target reservoir for the
sidetrack, which was subsequently drilled using a PowerDrive X6* rotary
steerable system in combination with EcoScope*^? multifunction
logging-while-drilling and PeriScope bed boundary mapper technology. In
accurately placing the challenging 386-m sidetrack within the 1-m thick
target zone, the value of the technology was clearly demonstrated.

In China, Drilling & Measurements Scope* services for greater
efficiency, improved reliability and better answers have been deployed
for PetroChina SWOGC. In one tight gas horizontal exploration well,
SonicScope* multipole sonic-while-drilling technology was used to help
quantify reservoir quality in real time with the high quality of the
data providing valuable permeability estimation, fracture information
and gas detection. As a result, the horizontal length of the well was
doubled by adjusting trajectory based on real-time integration of
SonicScope and seismic data. In another well, MicroScope* resistivity-
and imaging-while-drilling service enabled identification of structural
dip, faults and fractures for well placement and completion optimization
in a thin tight gas carbonate reservoir, while the same technology was
also deployed in a thick tight gas sandstone reservoir to steer a
horizontal well to intersect the most highly fractured areas. These
applications have opened new opportunities to further develop tight gas
reservoirs in the Sichuan Basin.

In Iraq, Drilling & Measurements PowerDrive X5* rotary steerable
technology with a Smith MDi613 polycrystalline diamond compact (PDC) bit
was deployed in the Rumaila field for the Rumaila Operating Organization
to drill the 6-in deviated section of a re-entry well. The technology
successfully drilled the 1,050-m section in a single run with a 60%
reduction in rig time compared to offset wells drilled with conventional
technology.

Also in Iraq, Drilling & Measurements PowerPak* steerable motor
technology was deployed in the Rumaila field operated by the Rumaila
Operating Organization to drill a 12 1/4-in section. The technology
successfully drilled the section with a 180% increase in performance
over the field average.

Elsewhere in Iraq, Drilling & Measurements PowerDrive vorteX* powered
rotary steerable technology was deployed to drill the 12 1/4-in section
of a deviated well. The technology successfully drilled the section in
one bit run with full directional control and improved the rate of
penetration (ROP) by 50% over the field average for vertical wells.

In Gabon, Drilling & Measurements PowerDrive Archer high-build-rate
rotary steerable system technology enabled Total Gabon to drill the
deviated section of a land horizontal well in a single bit run. Build
rates of 7 ?/100 ft were required to manage vertical depth uncertainties
and to place the well at the optimum distance from the oil-water contact
in the heterogeneous Gamba unconsolidated sandstone formation. This
would not have been possible with conventional technology and yielded
significant time reduction and risk mitigation. The subsequent
completion was run without problem.

PowerDrive Archer high-build-rate rotary steerable technology was also
introduced for BP in Alaska on a complex horizontal well that required a
build rate of more than 10 ?/100ft. The PowerDrive* system was run with a
customized Smith MDi513 drill bit and PeriScope bed-boundary mapper and
adnVISION* services.

In West Texas, Jetta Operating used Schlumberger Pathfinder services
including PowerDrive rotary steerable systems, and PeriScope, MicroScope
and SonicScope advanced logging-while-drilling technologies to position
a 5,100-ft lateral in an 11-ft thick reservoir while also acquiring the
data needed to optimize the completion design. During the subsequent
stimulation job, Jetta made adjustments to the program based on these
data, resulting in improvements to well performance.

Offshore Cameroon, Drilling & Measurements high-temperature PowerDrive,
EcoScope azimuthal density neutron, sonicVISION* sonic-while-drilling
and ImPulse* technologies have now been successfully deployed in three
wells for Bowleven (Euroil) and have reached maximum operating
temperatures of 194 deg C and depths of 4,800 m. Average
circulating-drilling temperatures reached 170 deg C in the reservoir
with static temperatures in excess of 200 deg C.

In the South China Sea, CNOOC Zhan Jiang deployed Drilling &
Measurements PeriScope bed boundary mapper technology with PowerDrive X6
rotary steerable and EcoScope multifunction logging-while-drilling
services to help better understand formation structure and drill back to
the reservoir after encountering a fault. The success of the operation,
which achieved 40% extra lateral length and avoided a sidetrack,
demonstrated the value of bed boundary mapper technology.

In the Yurubcheno-Tokhomskoe field in eastern Siberia, Smith Bits
engineers together with the technology department of LLC 'RN-Burenie?
(Rosneft) reduced the number of trips by 30% during the drilling of a
6-in liner section by using new-generation ONYX* PDC cutter technology.
Collaboration between field engineers, design engineers and hydraulics
experts using the Smith IDEAS* integrated drillbit design platform
optimized the drilling process and helped choose the proper premium PDC
bit with ONYX cutters to replace the rotary-cone technology previously
used in the field′s dolomitic formations.

In Russia, INTEGRA BURENIE awarded Schlumberger a contract for the
supply and service of Smith drill bits on the Dulisma field in eastern
Siberia in 2012. The award was based on the reduced drilling times
achieved in 2011 using PDC and rotary cone bit designs combined with
optimized drilling parameters appropriate to field well profiles and
geological conditions. New-technology ONYX II* premium PDC cutter
technology also contributed to the overall performance improvement.

In the Cotton Valley field in Texas, Anadarko used Schlumberger Drilling
Group technologies that included the PowerDrive Archer 675
high-build-rate system with a Smith MSi713 bit and M-I SWACO fluids and
solids control to drill a 3,000-ft horizontal well in 19.4 days. The
10 ?/100-ft curved section was completed in 49 hours, beating the
previous best by 8 hours. M-I SWACO centrifuge technology maintained
low-gravity solids content below 7%, which reduced materials consumption
and improved filter cake quality. Throughout this field, the services
have helped reduce well construction times by approximately five days
per well.

Production Group

First-quarter revenue of $3.54 billion decreased 4% sequentially but
increased 26% year-on-year. Pretax operating income of $621 million was
20% lower sequentially but increased 17% year-on-year.

Sequentially, revenue decreased on lower Well Services pricing and fleet
utilization in North America land, the effect of the exceptional
Artificial Lift and Completions Systems equipment sales seen in the
fourth quarter of 2011, and lower Framo and Schlumberger Production
Management activities. The transition of Well Services activities from
gas-rich to liquids-rich basins in North America also impacted results
as the reduced fleet utilization and new industry pressure-pumping
capacity led to competitive pricing declines.

First-quarter pretax operating margin decreased 338 bps to 17.6%
reflecting pricing erosion for Well Services technologies through
increased competitive forces from the introduction of new industry
pressure-pumping capacity into liquids plays following the industry
migration from gas-rich basins. Operating margin was also affected by
reduced asset fleet utilization and cost inflation for certain
materials. The seasonally lower Artificial Lift and Completions Systems
equipment sales also contributed to the margin decline.

Production Group highlights during the quarter included a number of
successes for Well Services and Well Intervention Services technologies.

In West Siberia, Well Services HiWAY* flow-channel hydraulic fracturing
technology was implemented in the remote Taylakovskoe oil field for
Slavneft-Megionneftegaz. Productivity analysis after treatment showed a
significant increase in oil production rate, reaching up to 50% higher
when compared to offset wells treated with conventional stimulating
techniques.

In the Haynesville Shale, Comstock Resources was the first operator to
apply the HiWAY channel fracturing technique by completing two wells in
January. The HiWAY technique was applied on both a three-well pad and a
single-well pad so that direct offset comparisons could be made.
Although production results are still forthcoming, Comstock noted
savings associated with the reduced water and proppant used during the
HiWAY completions.

In Egypt, HiWAY technology has been deployed for operators in the
Western Desert including Sahara Oil & Gas and Petrosilah.
Post-stimulation production data over 10 Sahara Oil & Gas wells showed a
22% increase in oil production rates compared to offsets in the same
field while 2 Petrosilah wells were successfully stimulated without the
screen-outs that have typified treatments in the El Fayum concession.
These two wells are also producing at higher initial post-stimulation
rates compared to offset wells fractured with conventional techniques.

In India, Well Services HiWAY flow-channel hydraulic fracturing
technology was successfully applied in the largest onshore brownfield
for ONGC. A multidisciplinary team comprising of members from ONGC and
Schlumberger was formed to perform a thorough study of the reservoir and
suggested application of HiWAY technology to this field. Initial
results, post fracture, indicate an increase in liquid production rate
of about 200%.

In the Kurdistan Region of Iraq, Schlumberger Well Services performed
the first stimulation with VDA* viscoelastic diverter fluid technology
for Gulf Keystone Petroleum International Ltd., operator of the Shaikan
block, using coiled-tubing conveyance in the Shaikan-4 appraisal well in
two zones in the Butmah and Kurra Chine-B limestone formations. While
these two zones would not produce before treatment, after stimulation
they produced at flow rates above 2,500 and 5,000 bbl/d, respectively,
exceeding expectations.

In Brazil, Well Intervention Services ACTive* Matrix in-well live
performance and Jet Blaster* high jetting scale removal technology were
deployed to stimulate an exploration well for Petrobras. The results
from ACTive pressure and temperature monitoring in combination with
post-treatment production logging results had demonstrated that
conventional stimulation methods were not suitable for multiple zones
with varying permeability profiles and that selective treatments could
be optimized using inflatable packers and distributed temperature
sensing. The development of this technique in Brazil was made possible
through the joint efforts of Schlumberger Technologies and Petrobras
engineering.

In Algeria, innovative use of Well Intervention Services ACTive coiled
tubing with ABRASIJET* hydraulic pipe-cutting and perforating services
enabled explosives-free completion of a natural gas well. The real-time
capability of the ACTive system enabled accurate depth control as well
as the ability to monitor the well during the operation while resolving
the logistical challenges of the completion operation.

In Saudi Arabia, Schlumberger Well Intervention Services performed an
ACTive in-well live performance stimulation job in an open-hole
completion in a natural gas well. The ACTive system used was equipped
with the new iFC+ fiber-optic string that permits pumping rates of up to
6 bpm. After identification of a thief zone at the liner shoe based on
distributed temperature sensor measurements, the pumping schedule was
modified to successfully stimulate the hydrocarbon-bearing interval at
the toe of the lateral using JetBlaster and ABRASIJET technologies to
bypass the damaged formation.

In Oman, Well Intervention Services ACTive in-well live performance
technology has been deployed for Petroleum Development of Oman in an
appraisal well in an oil-bearing carbonate reservoir. The operation was
performed in a challenging 600-m horizontal perforated completion zone
with 6% hydrogen sulphide content. The ACTive services run ?included
perforation debris removal, matrix stimulation using distributed
temperature sensing, and conveyance of Wireline Flow Scanner* horizontal
and deviated well production logging technology. Initial production
results showed a 26% improvement above target.

In Indonesia, the Well Services ClearPAC* fluid system for gravel
packing technology has been introduced to replace earlier generations of
carrier fluids in gravel pack operations in East Kalimantan for Total
E&P Indonesie (TEPI). The technology was used for the first time after
laboratory tests qualified the fluid as a replacement for the HEC-based
fluids used previously. After clean-up, the first field test on a well
in the field produced at double the rate expected using the previous
technology. Based on these results, TEPI has decided to use ClearPAC
fluids on future gravel pack operations in East Kalimantan.

In Montana, Schlumberger Completions deployed 36 Falcon* multistage
stimulation systems in an exploration well for Anschutz Exploration. The
technology, which uses hydraulically set open-hole packers to isolate
fracture stages during stimulation treatments, permits up to 20 stages
to be fractured continuously using balls of progressively increasing
diameters with drillable ball seats to increase efficiency during
multistage fracture operations.

Well Services DeepCRETE* deepwater well cementing technology with
GASBLOK* gas migration control was used for Statoil on a deepwater
exploration well in more than 2,582 m of water offshore Tanzania. Cement
returns and casing pressure tests confirmed good zonal isolation.

In Pakistan, Schlumberger Losseal* reinforced composite mat pills were
used for Ocean Pakistan Limited in a well on the Potwar Plateau field to
control loss of circulation in cementing the 9 5/8-in casing in the 12
1/4-in hole, and in drilling the 8 1/2-in section. The combination of
natural and induced fractures, and the mud weight contrast between the
two hole sections make wells in the field highly challenging to drill.
Losseal technology was used as a spacer during the 9 5/8-in two-stage
cement job, and two Losseal pills were placed in two separate zones in
the 8 1/2-in section. As a result of the success of the jobs, Ocean
Pakistan Limited has requested a permanent stock of Losseal pills to be
at their rig-site.

In Trinidad and Tobago, Schlumberger completed the first well in the BP
Serrette development with a lower completion optimized for high gas flow
rates that was developed by a joint team from BP and Schlumberger in a
fully integrated approach. M-I SWACO EMS 6700 filter-cake removal
technology was tested and used in conjunction with HEC carrier fluid for
the operation to ensure efficient filter-cake removal, effective gravel
packing, and maximum production rate. The fluids were used in
conjunction with an Alternate Path gravel pack system and a FIV*
formation isolation valve tool to prevent formation damage. Thorough
planning and execution resulted in a successful operation and a well
producing at the planned flow rate with significantly reduced drawdown
pressure.

In Brazil, Well Services Jet Blaster technology was deployed with a Well
Intervention Services X-11* modular offshore coiled-tubing services unit
for Repsol to successfully remove an 83-m hydrates plug that had
developed during well testing operations. The intervention was rapidly
engineered to overcome the challenges of other hydrate removal methods.

Schlumberger

Schlumberger is the world′s leading supplier of technology, integrated
project management and information solutions to customers working in the
oil and gas industry worldwide. Employing more than 113,000 people
representing over 140 nationalities and working in approximately 85
countries, Schlumberger provides the industry′s widest range of products
and services from exploration through production.

Schlumberger Limited has principal offices in Paris, Houston and The
Hague, and reported revenues of $39.54 billion in 2011. For more
information, visit www.slb.com.

*Mark of Schlumberger or of Schlumberger Companies

^?Japan Oil, Gas and Metals National Corporation (JOGMEC),
formerly Japan National Oil Corporation (JNOC), and Schlumberger
collaborated on a research project to develop LWD technology. EcoScope
service uses technology that resulted from this collaboration.

Notes

Schlumberger will hold a conference call to discuss the above
announcement and business outlook on Friday, April 20, 2012. The call is
scheduled to begin at 8:00 a.m. US Central Time (CT), 9:00 a.m. Eastern
Time (ET). To access the call, which is open to the public, please
contact the conference call operator at +1-800-230-1085 within North
America, or +1-612-288-0337 outside of North America, approximately 10
minutes prior to the call′s scheduled start time. Ask for the
'Schlumberger Earnings Conference Call.? At the conclusion of the
conference call an audio replay will be available until May 20, 2012 by
dialing +1-800-475-6701 within North America, or +1-320-365-3844 outside
of North America, and providing the access code 239412.

The conference call will be webcast simultaneously at www.slb.com/irwebcast
on a listen-only basis. Please log in 15 minutes ahead of time to test
your browser and register for the call. A replay of the webcast will
also be available at the same web site.

Supplemental information in the form of a question and answer document
on this press release and financial information is available at www.slb.com/ir.

Schlumberger Limited

Malcolm Theobald, +1 (713) 375-3535

Vice
President of Investor Relations

or

Joy V. Domingo, +1 (713)
375-3535

Manager of Investor Relations

investor-relations@slb.com