Annual Report 2011 - PGS

Board of Directors’
Report
Excess vessel capacity and low prices
for marine contract services made 2011 a
challenging year for the Marine seismic
industry. Still, during 2011 PGS managed to
reinforce its competitive position by delivering
record MultiClient late sales revenues and
maintaining a robust balance sheet. Through
continued investment in PGS’ unique
technologies, such as GeoStreamer GS, as
well as fleet expansion and improvement, PGS
is well positioned for profitable growth in a
seismic market with improving fundamentals.
Petroleum Geo-Services (PGS) is a focused
Marine geophysical company providing
a broad range of seismic and reservoir
services, including acquisition, processing,
interpretation, and field evaluation. We also
possess the world’s most geographically
diverse 3D MultiClient data library. Our
Company operates on a worldwide basis with
headquarters at Lysaker, Norway.
Our operations are organized into four business
units: Marine Contract, MultiClient, Operations,
and Data Processing & Technology (DP&T).
J J
Marine Contract initiates and manages client
relationships for seismic data acquired under
exclusive contracts with a diversified client
base comprising a wide range of the world’s
independent and sovereign oil and gas
exploration and production companies.
J J
MultiClient initiates and manages the
projects and the client relationships related
to seismic data licensed on a non-exclusive
basis from our library of field surveys
covering substantial parts of the major
offshore hydrocarbon basins that we and
our clients believe have the highest potential
for development such as offshore Brazil, the
Gulf of Mexico, offshore West Africa, the
Mediterranean Sea and the North Sea, while
we retain ownership of the seismic data.
J J
Operations supports both our Marine
Contract and MultiClient units with reliable
and efficient data acquisition by managing
the operation of our seismic vessels and
related equipment, including fleet expansion
and maintenance.
J J
DP&T processes the seismic data we acquire
for our MultiClient library and for our clients
on contract and manages our research and
development activities.
2011 Business Highlights
JJ
Revenues of $1,253 million
J J
EBITDA of $535 million
J J
Operating profit of $139 million, a margin of
11 percent
J J
Solid cash flow from operations of $480
million
J J
Robust balance sheet position, with net
interest-bearing debt of $394 million and a
liquidity reserve of $775 million
J J
MultiClient revenues of $502 million, with
record late sales revenues of $278 million
J J
Pre-funding level of 110 percent of capitalized
MultiClient cash investments
J J
Continued GeoStreamer implementation
with the upgrade of Ramform Viking and PGS
Apollo. By year-end 2011, nearly 60 percent
of PGS’ 3D capacity was equipped with
GeoStreamer
J J
Contract awarded to Mitsubishi Heavy
Industries Ltd. for delivery of two Ramform
Titan-class vessels
J J
Launched GeoStreamer GS — an acquisitionbased
solution that eliminates both source
and receiver ghosts to reveal the true earth
response — the only ghost-free acquisition
solution in the industry
J J
Successful offering of $300 million Senior
Notes , due December 2018.
Health, Safety, Environment and Quality
(HSEQ)
HSEQ management and reporting are key
elements in the evaluation of business
performance at all management levels and by
the Board of Directors.
In 2011, two main activities took place in the
continued building of a strong HSEQ culture
and improving PGS HSEQ management
systems;
OHSAS 18001 Certification was achieved
for the whole PGS fleet and the four main
offices (Lysaker, Houston, Weybridge and
Singapore). OHSAS 18001 is an internationally
acknowledged standard that defines
requirements for management systems for
occupational health and safety.
56 PGS Annual Report 2011