COMPANY PROFILE - Halliburton
Business Sector : Oil & Gas
Operating Geography : United States, Global
About Halliburton : Halliburton is an American multinational energy firm which employs over fifty thousand people as of 2018; and has dual headquarters in Dubai and Houston. It operates in the petroleum and natural gas exploration and production domain in over 70 countries. It also offers digital and consulting energy solutions, volume optimizations, fluid systems amongst other services through its several subsidies. It has a strong corporate governance code and maintains high health, environment and safety standards within the firm. Its mission as a company identifies what it does today, why it does so and for whom. While its vision defines what it aspires to be like and give it an image of success.
Halliburton Revenue : $15.9 billion as of FY 2017.
Competitive Analysis of Halliburton
|1. One of the world’s largest providers of products and services in the energy domain|
2. Strong technology arm with heavy inclination towards continuous innovation
3. Multiple product service lines (14) with Drilling, Production, Consulting being its key focus
4. Worldwide operations in across 70 countries with end-to-end service right from locating hydrocarbons to optimizing production
5. Strong brand value and constantly rated as the top firms in the oil and gas service sector
6. Strong CSR focus with initiatives including building schools, environment conservation etc. through the Halliburton Foundation
|1. Highly dependent on the international crude prices with volatility impacting its profitability
2. Multiple and strict governmental compliances norms to be followed in energy and gas sector resulting in operational slowdown
3. International sanctions and trade restrictions impacts business both in terms of product and technology
4. High environmental clean-up costs and other liabilities due to environmental laws
5. Negative profit margin, underperforming when compared to its key competitors
|1. New Fracturing operations opportunities with high demand for Shale gas|
2. Utilizing latest patented technology to identify new exploration fields in times of depleting resources through its Landmark Solution subsidiary
3. Increasing support to oil fields based deep in the ocean bedrock in the backdrop of rapidly depleting land based oil wells
4. Improvement in the economy and better oil prices futures will increase firm’s profitability
5. Reduction in the oil product transport cost due to improvement plans in its supply chain
6. Increasing investments in unconventional resources like shale, tight gas, coalbed methane and heavy oil will diversify its portfolio
|1. Indirect threat to oil prices from shale fracking would result in operational losses
2. Increased competition in the oil and gas industry will wipe out the profitability
3. Different liability laws in different countries exposes Halliburton to operational risks like stoppage of operations
4. Constant danger to its assets with Macondo incident (rig sinking) leading to high unforeseeable costs
Detailed SWOT Analysis of Halliburton
2. Utilizing latest patented technology to identify new exploration fields in times of depleting resources through its Landmark Solution subsidiary: Landmark is a subsidiary of Halliburton which is a technological solutions provider in the domain of exploration and production industry. It provides decision support which enable the energy companies to lower production costs, boost productivity resulting in economic gains. Landmark has grown rapidly and has acquired over 1100 patents in this field and its technology is heavily used in the Gulf of Mexico oil basin.
It claims to provide “last drop oil recovery” which essentially aims to design and build an efficient oil extraction system. With its latest geo-science mapping technology, Landmark also works in oil field exploration, optimizing well placements and maps out cost effectiveness of the reserve. It also assists companies to plan their investment and finances in order to reduce uncertainties in the projects and improve value expectations.
The firm also specializes in providing drilling solutions in extreme environments and creates sub-surface imagery for safer extractions. It follows the Halliburton’s strict code of health, safety and environment in its operations which allows for a sustainable development.
In 2017, Landmark worked with the Nigerian Government to develop a training centre equipped with oilfield operation tools. In the near future, as the number of players increase, there would be an increasing reliance on Landmark solutions especially by the developing countries with oil reserves.
The detailed Strength, Weakness, Opportunity, Threat - SWOT Analysis Report along with Political, Economic, Social, Technological, Legal and Environmental - PESTLE Analysis Report is available only in the 'Complete Report' on purchase.
|1. Political stability is vital for any operation in oil and gas industry as every operation is dependent on government intervention and regulation especially with high risk of nationalization of oil and gas assets|
2. Risk of armed conflict, war and civil unrest
3. Trade regulations, work regulations and price regulations impact operations
|1. Risk of inflation, currency fluctuations, devaluations, international interest rates and adverse tax policies which could restrict movement of funds
2. Volatility in economic prices of oil
3. Wage laws in the country
4. Adverse tax policies, limit the movement of funds and payment restrictions
|1. Culture of the country of operations in terms of openness to innovation, change and education level|
2. Social risk and safety impact of its employees
|1. Rapid technological changes in oil exploration and production domain especially in automation
2. Risk of cyber-attacks to the digital platform of Halliburton
3. Increasing automation affinity in the industry
4. Technological sanctions which lead to different technology being used in different global locations
|1. Mandatory compliance to multiple regulatory requirements including safety measures which is country specific|
2. Legal liability fees and expenses which is country specific in an event of any incident
3. High mandatory safety measures which needs to be followed
|1. Compliance to multiple environmental acts and international treaties and constant need to monitor the environment
2. Challenge to maintain a low carbon footprint
3. Country specific damage remedy laws for natural resource depletion
Detailed PESTLE Analysis of Halliburton
1. Political stability is vital for any operation in oil and gas industry as every operation is dependent on government intervention and regulation: Any company working in the oil and gas domain is highly impacted by the functioning of the government and political stability in the operation country. For instance, the recent Venezuelan crisis of 2016 impacted the oil exploration companies with many forced to cease operations. Halliburton reported a loss of hundreds of millions due to the decaying socialist system which led to operational delays
Political stability also transcends borders as countries tend to place trade restrictions, embargo as in the case of Qatar-Gulf crisis. Halliburton has a Qatar division which got impacted during the crisis. The ongoing US-Iraq conflicts and the US government enabled Halliburton to land few development contracts in Iraq for the extraction of the Iraqi Oil. However, when ISIS declared a caliphate in Iraq, these projects faced massive delays and Halliburton subsidiary in Iraq suffered losses.
Since oil and gas is an essential resource, there is always a risk of nationalization of the entire industry and is highly dependent on the government of the day. Prime example is the overnight nationalization of the Saudi-ARAMCO which poses threat to the Halliburton assets especially in the developing countries in Africa.
The detailed Political, Economic, Social, Technological, Legal and Environmental - PESTLE Analysis Report along with Strength, Weakness, Opportunity, Threat - SWOT Analysis Report is available only in the 'Complete Report' on purchase.