Halliburton is considering listing its shares on one of the Middle East bourses as it looks at growth potential in the eastern hemisphere, the firm’s chief executive said on Sunday.
The news comes on the same day that the U.S. oilfield service giant said that it is to open a corporate HQ in Dubai.
ArabianBusiness.com has learnt that the office is likely to be at the Dubai International Finance Centre (DIFC).
“There is something happening with the DIFC and DIFX,” said a source in Dubai, although this is as yet unconfirmed.
A spokesperson for Dubai’s international stock exchange, the DIFX, would not comment on whether a listing on the exchange would complement a possible office presence at the DIFC.
“Our stance is that, until everything is legally agreed, we never talk about these things,” said the spokesperson.
Halliburton says that it has not yet decided in which country it would list its shares. “One of the things that we would like to pursue… is a listing of our shares in the Middle East,” is all that its chief executive David Lesar would say.
“At this point in time we clearly see there are greater opportunities in the eastern hemisphere than the western hemisphere,” Lesar told reporters at an energy event in Bahrain.
Lesar said he expected the price of oil to stay above $40 a barrel, providing good conditions for future investment in the oil and gas industry.
He added that he would move his office to Dubai as the company focused on the region for future growth. Halliburton’s global headquarters would remain in Houston, another company executive said.
“My office will be in Dubai and I will run our entire worldwide operations from that office,” Lesar said. “Dubai is a great business centre.”
A statement on the Halliburton website confirms that the opening of the Dubai office is in order to strengthen the company’s activities in the Middle East, Africa, Asia Pacific and Europe/Eurasia regions.
“The opening of a headquarters in Dubai is the next step in a strategic plan announced in 2006 to focus on expanding its customer relations with national oil companies while concentrating more of the company’s investments and resources in growing its business in the Eastern Hemisphere,” says the statement.
“As we invest more heavily in our Eastern Hemisphere presence, we will continue to build upon our leading position in the North American gas-focused market through our excellent mix of technology, reservoir knowledge and an experienced workforce,” said Lesar in the online statement. “Our talented Western Hemisphere leadership will continue to grow this area of our business.
“The Eastern Hemisphere is a market that is more heavily weighted toward oil exploration and production opportunities and growing our business here will bring more balance to Halliburton’s overall portfolio.”
During 2006, more than 38% of Halliburton’s US$13 billion oil field services revenue was generated from the Eastern Hemisphere, according to its website.
Halliburton would spend a large part of its $1.4 billion investment budget for the year in the Middle East, claims Lesar.
The area encompasses four regions with more than 16,000 employees, more than 80% of which are localised.
Oil and gas service companies have hiked prices for their services over the past two years as the energy sector strains to bring on line enough capacity to meet rapidly rising demand.
Many of the new supply projects are in the oil producing countries of the Middle East, while Asia accounts for most of the rising demand.
In contrast, a slide in natural gas prices in the United States has prompted investor concern that oil and gas companies might cut back on spending in North America.
Halliburton has long been involved in the Middle East energy sector.
KBR Inc., the engineering and military-services contractor unit that Halliburton recently spun off, is the Pentagon’s largest contractor in Iraq. The company has faced several investigations into alleged overbilling there, as well as for its links to Iran, where U.S. companies are forbidden from operating.
U.S. Vice President Dick Cheney was head of the company from 1995-2000.
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