ABB and Schlumberger in subsea joint venture

Teaming to develop market leading capability

Zurich, Switzerland, October 16, 2000 – Global technology group ABB and Schlumberger announced today that they have signed a Memorandum of Understanding (MOU) to form a joint venture aimed at improving the economics of subsea oil and gas development.

The scope of the memorandum includes development of new technologies and services that will be needed in hydrocarbon production from the oil reservoir to the delivery point – whether on a platform, ship or directly to shore.

“We will combine Schlumberger reservoir evaluation, development and management experience, including downhole monitoring and control, with ABB’s subsea knowledge expertise, including application of new technologies for downhole intelligent completions, subsea processing and power distribution,” said Göran Lindahl, President and CEO of ABB. “Together, we can provide customers with new field development solutions that will increase recovery from subsea fields.”

The worldwide joint venture – that will not require any material equity investment – will offer new technology for deepwater and offshore assets based on a risk-reward business model. ABB and Schlumberger said the oil, gas and petrochemicals industry is increasingly geared to sharing both the risk and reward involved with moving a project or technology forward – for example, joint project development and execution, as well as in research and development or in financing.

“Our objective is to provide the systems and processes that will allow our customers to develop both deepwater and marginal offshore fields more economically,” said Euan Baird, Chairman and CEO of Schlumberger. “We believe that by working together, we can deliver innovative solutions that will significantly advance the state-of-the-art in subsea field development.”

A definite agreement between the parties is anticipated before year-end 2000.

Schlumberger Limited is the leading supplier of services and technology to the international petroleum industry and operates offices, service locations, and research and development facilities around the world. Schlumberger is a global leader in technical services spanning the oil and gas, utility, semiconductor, smart card, network and Internet solutions industries. Schlumberger revenue was $8.4 billion in 1999. Additional information is available at www.slb.com.

The ABB Group (www.abb.com) serves customers in power transmission and distribution; automation; oil, gas, and petrochemicals; building technologies; and in financial services. With novel IT applications, tailored software solutions, growing eBusiness and a fast-expanding knowledge and service base, ABB is building links to the new economy. The ABB Group employs about 160,000 people in more than 100 countries and had revenues of approximately US$ 25 billion in 1999. (End)

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