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EXHIBIT 99.1
SCHLUMBERGER AND BAKER HUGHES AGREE TO CREATE SEISMIC VENTURE
NEW YORK, May 31, 2000 -- Schlumberger Limited [NYSE:SLB] announced today the
signing of a Memorandum of Understanding with Baker Hughes Incorporated under
which the Schlumberger surface seismic business, Geco-Prakla, would join with
the Western Geophysical seismic unit of Baker Hughes to form a new venture to be
called Western GECO. The creation of Western GECO is subject to completion of a
definitive agreement, and to regulatory and board approvals. The transaction is
expected to be completed before the end of the year.
The Western GECO venture would own the seismic fleets, data processing assets,
exclusive and nonexclusive multiclient or other surveys, and other assets
currently comprising the surface seismic businesses of Schlumberger and Baker
Hughes. In connection with the formation of the venture, Schlumberger would pay
Baker Hughes $500 million in cash. The new venture would be owned 70% by
Schlumberger and 30% by Baker Hughes.
Gary Jones, the current president of Western Geophysical would be president of
the venture.
The Western GECO seismic venture would have had pro forma 1999 revenue of
approximately $1.5 billion.
In making this announcement, Andrew Gould, executive vice president Schlumberger
Oilfield Services, said, "This is a natural alignment of two quality seismic
companies with complementary markets, technologies and cultural values. The two
companies share a common commitment to delivering the best possible seismic
services to our customers in a safe and economical manner." Gould added, "This
new venture combining Geco-Prakla and Western Geophysical is expected to permit
the implementation of substantial cost savings, resulting in better results than
would be possible for the companies operating separately. These cost savings
would support the development and innovation necessary to help seismic maintain
its role as a key contributor to the oil industry's process of lowering the cost
of finding and producing oil and gas."
Schlumberger is a worldwide leader in technical services with 55,000 employees
and operations in over 100 countries. In 1999, revenue was $8.4 billion.
Forward-looking Statements
This press release and oral statements made in connection herewith contain
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements include, among other
things, the terms of the definitive agreement regarding the transaction,
statements regarding the anticipated prospects for and development of the
combined operations of Geco-Prakla and Western Geophysical, the integration of
their business and operations, and anticipated cost savings, all of which are
subject to certain risks, uncertainties and assumptions. These include the
consummation of the transaction as currently anticipated, regulatory review and
the companies' respective due diligence reviews. In addition, these risks and
uncertainties also include the following which are more fully described in the
Annual, Quarterly and Current reports and other filings made with the Securities
and Exchange Commission by Schlumberger and Baker Hughes, such as changes in
industry and market conditions and the price of oil and gas, and the impact of
such changes on Schlumberger and Baker Hughes. Should one or more of these risks
or uncertainties materialize, or should the assumptions prove incorrect, actual
results from the business of the venture may vary in material respects from
those currently anticipated.
