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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: September 30, 2020

Commission file No.: 1-4601

 

SCHLUMBERGER N.V.

(SCHLUMBERGER LIMITED)

(Exact name of registrant as specified in its charter)

 

 

Curaçao

 

52-0684746

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.)

 

 

 

42 RUE SAINT-DOMINIQUE

 

 

PARIS, FRANCE

 

75007

 

 

 

5599 SAN FELIPE

 

 

HOUSTON, Texas, U.S.A.

 

77056

 

 

 

62 BUCKINGHAM GATE

 

 

LONDON, UNITED KINGDOM

 

SW1E 6AJ

 

 

 

PARKSTRAAT 83, THE HAGUE,

 

 

THE NETHERLANDS

 

2514 JG

(Addresses of principal executive offices)

 

(Zip Codes)

Registrant’s telephone number in the United States, including area code, is:   (713513-2000

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

common stock, par value $0.01 per share

SLB

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

  

Accelerated filer

 

Non-accelerated filer

 

  

Smaller reporting company

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class

Outstanding at September 30, 2020

COMMON STOCK, $0.01 PAR VALUE PER SHARE

1,392,030,009  

 

 

 

 

 

 

 


 

SCHLUMBERGER LIMITED

Third Quarter 2020 Form 10-Q

Table of Contents

 

 

 

 

Page

PART I

 

Financial Information

 

 

 

 

 

Item 1.

 

Financial Statements

3

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

24

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

33

 

 

 

 

Item 4.

 

Controls and Procedures

33

 

 

 

 

PART II

 

Other Information

 

 

 

 

 

Item 1.

 

Legal Proceedings

34

 

 

 

 

Item 1A.

 

Risk Factors

34

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

34

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

34

 

 

 

 

Item 4.

 

Mine Safety Disclosures

34

 

 

 

 

Item 5.

 

Other Information

34

 

 

 

 

Item 6.

 

Exhibits

35

 

 

 

 

 

 


 

PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements.

 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF LOSS

(Unaudited)

 

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Services

$

3,666

 

 

$

6,332

 

 

$

12,812

 

 

$

18,390

 

Product sales

 

1,592

 

 

 

2,209

 

 

 

5,257

 

 

 

6,299

 

Total Revenue

 

5,258

 

 

 

8,541

 

 

 

18,069

 

 

 

24,689

 

Interest & other income

 

22

 

 

 

21

 

 

 

94

 

 

 

61

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of services

 

3,127

 

 

 

5,371

 

 

 

11,236

 

 

 

15,794

 

Cost of sales

 

1,497

 

 

 

2,014

 

 

 

4,936

 

 

 

5,800

 

Research & engineering

 

137

 

 

 

176

 

 

 

452

 

 

 

527

 

General & administrative

 

85

 

 

 

120

 

 

 

293

 

 

 

345

 

Impairments & other

 

350

 

 

 

12,692

 

 

 

12,596

 

 

 

12,692

 

Interest

 

138

 

 

 

160

 

 

 

419

 

 

 

462

 

Loss before taxes

 

(54

)

 

 

(11,971

)

 

 

(11,769

)

 

 

(10,870

)

Tax expense (benefit)

 

19

 

 

 

(598

)

 

 

(901

)

 

 

(420

)

Net loss

 

(73

)

 

 

(11,373

)

 

 

(10,868

)

 

 

(10,450

)

Net income attributable to noncontrolling interests

 

9

 

 

 

10

 

 

 

24

 

 

 

20

 

Net loss attributable to Schlumberger

$

(82

)

 

$

(11,383

)

 

$

(10,892

)

 

$

(10,470

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic loss per share of Schlumberger

$

(0.06

)

 

$

(8.22

)

 

$

(7.84

)

 

$

(7.56

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted loss per share of Schlumberger

$

(0.06

)

 

$

(8.22

)

 

$

(7.84

)

 

$

(7.56

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1,391

 

 

 

1,385

 

 

 

1,389

 

 

 

1,385

 

Assuming dilution

 

1,391

 

 

 

1,385

 

 

 

1,389

 

 

 

1,385

 

 

See Notes to Consolidated Financial Statements

 

 

3


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS

(Unaudited)

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Net loss

$

(73

)

 

$

(11,373

)

 

$

(10,868

)

 

$

(10,450

)

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized net change arising during the period

 

(94

)

 

 

(21

)

 

 

(200

)

 

 

18

 

Cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain (loss) on cash flow hedges

 

36

 

 

 

(27

)

 

 

(195

)

 

 

(31

)

Reclassification to net income of net realized loss

 

7

 

 

 

3

 

 

 

12

 

 

 

7

 

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization to net loss of net actuarial loss

 

48

 

 

 

23

 

 

 

150

 

 

 

70

 

Amortization to net loss of net prior service credit

 

(2

)

 

 

(2

)

 

 

(13

)

 

 

(8

)

Impact of curtailment

 

-

 

 

 

-

 

 

 

(69

)

 

 

-

 

Income taxes on pension and other postretirement benefit plans

 

-

 

 

 

(1

)

 

 

10

 

 

 

(3

)

Comprehensive loss

 

(78

)

 

 

(11,398

)

 

 

(11,173

)

 

 

(10,397

)

Comprehensive income attributable to noncontrolling interests

 

9

 

 

 

10

 

 

 

24

 

 

 

20

 

Comprehensive loss attributable to Schlumberger

$

(87

)

 

$

(11,408

)

 

$

(11,197

)

 

$

(10,417

)

 

See Notes to Consolidated Financial Statements

 

 

 

4


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

 

 

 

 

2020

 

 

Dec. 31,

 

 

(Unaudited)

 

 

2019

 

ASSETS

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

 

Cash

$

1,219

 

 

$

1,137

 

Short-term investments

 

2,618

 

 

 

1,030

 

Receivables less allowance for doubtful accounts (2020 - $299; 2019 - $255)

 

5,552

 

 

 

7,747

 

Inventories

 

3,542

 

 

 

4,130

 

Other current assets

 

1,284

 

 

 

1,486

 

 

 

14,215

 

 

 

15,530

 

Investments in Affiliated Companies

 

1,436

 

 

 

1,565

 

Fixed Assets less accumulated depreciation

 

7,396

 

 

 

9,270

 

Multiclient Seismic Data

 

344

 

 

 

568

 

Goodwill

 

12,968

 

 

 

16,042

 

Intangible Assets

 

3,573

 

 

 

7,089

 

Deferred Taxes

 

33

 

 

 

-

 

Other Assets

 

4,101

 

 

 

6,248

 

 

$

44,066

 

 

$

56,312

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

$

9,201

 

 

$

10,663

 

Estimated liability for taxes on income

 

974

 

 

 

1,209

 

Short-term borrowings and current portion of long-term debt

 

1,292

 

 

 

524

 

Dividends payable

 

184

 

 

 

702

 

 

 

11,651

 

 

 

13,098

 

Long-term Debt

 

16,471

 

 

 

14,770

 

Postretirement Benefits

 

854

 

 

 

967

 

Deferred Taxes

 

-

 

 

 

491

 

Other Liabilities

 

2,721

 

 

 

2,810

 

 

 

31,697

 

 

 

32,136

 

Equity

 

 

 

 

 

 

 

Common stock

 

12,921

 

 

 

13,078

 

Treasury stock

 

(3,055

)

 

 

(3,631

)

Retained earnings

 

6,818

 

 

 

18,751

 

Accumulated other comprehensive loss

 

(4,743

)

 

 

(4,438

)

Schlumberger stockholders’ equity

 

11,941

 

 

 

23,760

 

Noncontrolling interests

 

428

 

 

 

416

 

 

 

12,369

 

 

 

24,176

 

 

$

44,066

 

 

$

56,312

 

 

See Notes to Consolidated Financial Statements

 

 

 

5


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30,

 

 

2020

 

 

2019

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net loss

$

(10,868

)

 

$

(10,450

)

Adjustments to reconcile net loss to cash provided by operating activities:

 

 

 

 

 

 

 

Impairments and other charges

 

12,596

 

 

 

12,692

 

Depreciation and amortization (1)

 

1,983

 

 

 

2,741

 

Deferred taxes

 

(1,147

)

 

 

(833

)

Stock-based compensation expense

 

318

 

 

 

329

 

Earnings of equity method investments, less dividends received

 

(18

)

 

 

2

 

Change in assets and liabilities: (2)

 

 

 

 

 

 

 

Decrease (increase) in receivables

 

2,159

 

 

 

(429

)

Increase in inventories

 

(24

)

 

 

(400

)

Decrease (increase) in other current assets

 

202

 

 

 

(127

)

Decrease (increase) in other assets

 

25

 

 

 

(12

)

Decrease in accounts payable and accrued liabilities

 

(2,898

)

 

 

(266

)

Decrease in estimated liability for taxes on income

 

(261

)

 

 

(118

)

Decrease in other liabilities

 

(14

)

 

 

(19

)

Other

 

13

 

 

 

69

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

2,066

 

 

 

3,179

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Capital expenditures

 

(858

)

 

 

(1,230

)

APS investments

 

(252

)

 

 

(526

)

Multiclient seismic data costs capitalized

 

(86

)

 

 

(181

)

Business acquisitions and investments, net of cash acquired

 

(33

)

 

 

(21

)

(Purchase) sale of investments, net

 

(1,597

)

 

 

238

 

Net proceeds from divestitures

 

325

 

 

 

-

 

Other

 

(98

)

 

 

(88

)

NET CASH USED IN INVESTING ACTIVITIES

 

(2,599

)

 

 

(1,808

)

Cash flows from financing activities:

 

 

 

 

 

 

 

Dividends paid

 

(1,560

)

 

 

(2,077

)

Proceeds from employee stock purchase plan

 

146

 

 

 

196

 

Proceeds from exercise of stock options

 

-

 

 

 

23

 

Stock repurchase program

 

(26

)

 

 

(278

)

Proceeds from issuance of long-term debt

 

5,837

 

 

 

3,973

 

Repayment of long-term debt

 

(3,811

)

 

 

(3,396

)

Net increase (decrease) in short-term borrowings

 

96

 

 

 

(44

)

Other

 

(51

)

 

 

(18

)

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

 

631

 

 

 

(1,621

)

Net increase in cash before translation effect

 

98

 

 

 

(250

)

Translation effect on cash

 

(16

)

 

 

-

 

Cash, beginning of period

 

1,137

 

 

 

1,433

 

Cash, end of period

$

1,219

 

 

$

1,183

 

 

 

(1)

Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.  

(2)

Net of the effect of business acquisitions and divestitures.

 

See Notes to Consolidated Financial Statements

 

 

 

6


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(Unaudited)

 

 

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

January 1, 2020 – September 30, 2020

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, January 1, 2020

 

$

13,078

 

 

$

(3,631

)

 

$

18,751

 

 

$

(4,438

)

 

$

416

 

 

$

24,176

 

Net loss

 

 

 

 

 

 

 

 

 

 

(10,892

)

 

 

 

 

 

 

24

 

 

 

(10,868

)

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(200

)

 

 

2

 

 

 

(198

)

Changes in fair value of cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(183

)

 

 

 

 

 

 

(183

)

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

78

 

 

 

 

 

 

 

78

 

Vesting of restricted stock

 

 

(152

)

 

 

152

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Shares issued under employee stock purchase plan

 

 

(298

)

 

 

444

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

146

 

Stock repurchase program

 

 

 

 

 

 

(26

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(26

)

Stock-based compensation expense

 

 

318

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

318

 

Dividends declared ($0.75 per share)

 

 

 

 

 

 

 

 

 

 

(1,041

)

 

 

 

 

 

 

 

 

 

 

(1,041

)

Other

 

 

(25

)

 

 

6

 

 

 

 

 

 

 

 

 

 

 

(14

)

 

 

(33

)

Balance, September 30, 2020

 

$

12,921

 

 

$

(3,055

)

 

$

6,818

 

 

$

(4,743

)

 

$

428

 

 

$

12,369

 

 

 

 

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

January 1, 2019 – September 30, 2019

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, January 1, 2019

 

$

13,132

 

 

$

(4,006

)

 

$

31,658

 

 

$

(4,622

)

 

$

424

 

 

$

36,586

 

Net loss

 

 

 

 

 

 

 

 

 

 

(10,470

)

 

 

 

 

 

 

20

 

 

 

(10,450

)

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

 

 

(4

)

 

 

14

 

Changes in fair value of cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(24

)

 

 

 

 

 

 

(24

)

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

59

 

 

 

 

 

 

 

59

 

Shares sold to optionees, less shares exchanged

 

 

(26

)

 

 

49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23

 

Vesting of restricted stock

 

 

(146

)

 

 

146

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Shares issued under employee stock purchase plan

 

 

(249

)

 

 

445

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

196

 

Stock repurchase program

 

 

 

 

 

 

(278

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(278

)

Stock-based compensation expense

 

 

329

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

329

 

Dividends declared ($1.50 per share)

 

 

 

 

 

 

 

 

 

 

(2,077

)

 

 

 

 

 

 

 

 

 

 

(2,077

)

Other

 

 

(28

)

 

 

3

 

 

 

 

 

 

 

 

 

 

 

(26

)

 

 

(51

)

Balance, September 30, 2019

 

$

13,012

 

 

$

(3,641

)

 

$

19,111

 

 

$

(4,569

)

 

$

414

 

 

$

24,327

 

 

 

 

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

July 1, 2020 – September 30, 2020

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, July 1, 2020

 

$

13,044

 

 

$

(3,339

)

 

$

7,073

 

 

$

(4,738

)

 

$

416

 

 

$

12,456

 

Net loss

 

 

 

 

 

 

 

 

 

 

(82

)

 

 

 

 

 

 

9

 

 

 

(73

)

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(94

)

 

 

4

 

 

 

(90

)

Changes in fair value of cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

43

 

 

 

 

 

 

 

43

 

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

46

 

 

 

 

 

 

 

46

 

Vesting of restricted stock

 

 

(21

)

 

 

21

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Shares issued under employee stock purchase plan

 

 

(203

)

 

 

264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

61

 

Stock-based compensation expense

 

 

105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

105

 

Dividends declared ($0.125 per share)

 

 

 

 

 

 

 

 

 

 

(173

)

 

 

 

 

 

 

 

 

 

 

(173

)

Other

 

 

(4

)

 

 

(1

)

 

 

 

 

 

 

 

 

 

 

(1

)

 

 

(6

)

Balance, September 30, 2020

 

$

12,921

 

 

$

(3,055

)

 

$

6,818

 

 

$

(4,743

)

 

$

428

 

 

$

12,369

 

7


 

 

 

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

July 1, 2019 – September 30, 2019

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, July 1, 2019

 

$

13,037

 

 

$

(3,827

)

 

$

31,186

 

 

$

(4,544

)

 

$

421

 

 

$

36,273

 

Net loss

 

 

 

 

 

 

 

 

 

 

(11,383

)

 

 

 

 

 

 

10

 

 

 

(11,373

)

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(21

)

 

 

(4

)

 

 

(25

)

Changes in fair value of cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(24

)

 

 

 

 

 

 

(24

)

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20

 

 

 

 

 

 

 

20

 

Shares sold to optionees, less shares exchanged

 

 

(20

)

 

 

20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Vesting of restricted stock

 

 

(134

)

 

 

245

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

111

 

Stock repurchase program

 

 

 

 

 

 

(79

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(79

)

Stock-based compensation expense

 

 

135

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

135

 

Dividends declared ($0.50 per share)

 

 

 

 

 

 

 

 

 

 

(692

)

 

 

 

 

 

 

 

 

 

 

(692

)

Other

 

 

(6

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13

)

 

 

(19

)

Balance, September 30, 2019

 

$

13,012

 

 

$

(3,641

)

 

$

19,111

 

 

$

(4,569

)

 

$

414

 

 

$

24,327

 

 

SHARES OF COMMON STOCK

(Unaudited)

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

Issued

 

 

In Treasury

 

 

Outstanding

 

Balance, January 1, 2020

 

1,434

 

 

 

(49

)

 

 

1,385

 

Vesting of restricted stock

 

-

 

 

 

2

 

 

 

2

 

Shares issued under employee stock purchase plan

 

-

 

 

 

6

 

 

 

6

 

Stock repurchase program

 

-

 

 

 

(1

)

 

 

(1

)

Balance, September 30, 2020

 

1,434

 

 

 

(42

)

 

 

1,392

 

 

 

See Notes to Consolidated Financial Statements

 

 

8


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1.   Basis of Presentation

The accompanying unaudited consolidated financial statements of Schlumberger Limited and its subsidiaries (“Schlumberger”) have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of Schlumberger management, all adjustments considered necessary for a fair statement have been included in the accompanying unaudited financial statements.  All intercompany transactions and balances have been eliminated in consolidation.  Operating results for the nine-month period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020.  The December 31, 2019 balance sheet information has been derived from the Schlumberger 2019 audited financial statements.  For further information, refer to the Consolidated Financial Statements and notes thereto included in the Schlumberger Annual Report on Form 10-K for the year ended December 31, 2019, filed with the Securities and Exchange Commission on January 22, 2020.

On August 31, 2020, Schlumberger and Liberty Oilfield Services Inc. (“Liberty”) entered into an agreement for the contribution to Liberty of OneStim®, Schlumberger’s onshore hydraulic fracturing business in the United States and Canada, including its pressure pumping, pumpdown perforating, and Permian frac sand businesses, in exchange for a 37% equity interest in Liberty.  The transaction is expected to close in the fourth quarter of 2020 and is subject to Liberty stockholder approval and other customary closing conditions.  OneStim represented approximately 5% of Schlumberger’s consolidated revenue for the nine months ended September 30, 2020.

2.   Charges and Credits

Schlumberger recorded the following charges and credits during 2020, all of which are classified in Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

First quarter:

 

 

 

 

 

 

 

 

 

 

 

Goodwill

$

3,070

 

 

$

-

 

 

$

3,070

 

Intangible asset impairments

 

3,321

 

 

 

(815

)

 

 

2,506

 

Asset Performance Solutions investments

 

1,264

 

 

 

4

 

 

 

1,268

 

North America pressure pumping impairment

 

587

 

 

 

(133

)

 

 

454

 

Workforce reductions

 

202

 

 

 

(7

)

 

 

195

 

Other

 

79

 

 

 

(9

)

 

 

70

 

Valuation allowance

 

-

 

 

 

164

 

 

 

164

 

Second quarter:

 

 

 

 

 

 

 

 

 

 

 

Workforce reductions

 

1,021

 

 

 

(71

)

 

 

950

 

Asset Performance Solutions investments

 

730

 

 

 

(15

)

 

 

715

 

Fixed asset impairments

 

666

 

 

 

(52

)

 

 

614

 

Inventory write-downs

 

603

 

 

 

(49

)

 

 

554

 

Right-of-use asset impairments

 

311

 

 

 

(67

)

 

 

244

 

Costs associated with exiting certain activities

 

205

 

 

 

25

 

 

 

230

 

Multiclient seismic data impairment

 

156

 

 

 

(2

)

 

 

154

 

Repurchase of bonds

 

40

 

 

 

(2

)

 

 

38

 

Postretirement benefits curtailment gain

 

(69

)

 

 

16

 

 

 

(53

)

Other

 

60

 

 

 

(4

)

 

 

56

 

Third quarter:

 

 

 

 

 

 

 

 

 

 

 

Facility exit charges

 

254

 

 

 

(39

)

 

 

215

 

Workforce reductions

 

63

 

 

 

-

 

 

 

63

 

Other

 

33

 

 

 

(1

)

 

 

32

 

 

$

12,596

 

 

$

(1,057

)

 

$

11,539

 

 

9


 

First quarter 2020:

 

 

Geopolitical events that increased the supply of low-priced oil to the global market occurred at the same time that demand weakened due to the worldwide effects of the COVID-19 pandemic, leading to a collapse in oil prices during March 2020.  As a result, Schlumberger’s market capitalization deteriorated significantly compared to the end of 2019.  Schlumberger’s stock price reached a low during the first quarter of 2020 not seen since 1995.  Additionally, the Philadelphia Oil Services Sector index, which is comprised of companies involved in the oil services sector, reached an all-time low.  As a result of these facts, Schlumberger determined that it was more likely than not that the fair value of certain of its reporting units were less than their carrying value.  Therefore, Schlumberger performed an interim goodwill impairment test.

Schlumberger had 11 reporting units with goodwill balances aggregating $16.0 billion.  Schlumberger determined that the fair value of four of its reporting units, representing $4.5 billion of the goodwill, was substantially in excess of their carrying value.  Schlumberger performed a detailed quantitative impairment assessment of the remaining seven reporting units, which represented $11.5 billion of goodwill. As a result of this assessment, Schlumberger concluded that the goodwill associated with each of these seven reporting units was impaired, resulting in a $3.1 billion goodwill impairment charge.  This charge primarily relates to goodwill associated with the Drilling and Production segments.

 

Following the $3.1 billion goodwill impairment charge relating to these seven reporting units, six of these reporting units had a remaining goodwill balance.  These six reporting units had goodwill balances which ranged between $0.2 billion and $5.0 billion and aggregated to $8.4 billion as of March 31, 2020.

 

Schlumberger used the income approach to estimate the fair value of its reporting units, but also considered the market approach to validate the results.  The income approach estimates the fair value by discounting each reporting unit’s estimated future cash flows using Schlumberger’s estimate of the discount rate, or expected return, that a marketplace participant would have required as of the valuation date.  The market approach includes the use of comparative multiples to corroborate the discounted cash flow results. The market approach involves significant judgement involved in the selection of the appropriate peer group companies and valuation multiples.

 

Some of the more significant assumptions inherent in the income approach include the estimated future net annual cash flows for each reporting unit and the discount rate.  Schlumberger selected the assumptions used in the discounted cash flow projections using historical data supplemented by current and anticipated market conditions and estimated growth rates.  Schlumberger’s estimates are based upon assumptions believed to be reasonable.  However, given the inherent uncertainty in determining the assumptions underlying a discounted cash flow analysis, particularly in the current volatile market, actual results may differ from those used in Schlumberger’s valuations which could result in additional impairment charges in the future.

 

The discount rates utilized to value Schlumberger’s reporting units were between 12.0% and 13.5%, depending on the risks and uncertainty inherent in the respective reporting unit as well as the size of the reporting unit.  Assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50-basis point increase or decrease in the discount rate assumptions would have changed the fair value of the seven reporting units, on average, by less than 5%.

 

 

The negative market indicators described above were triggering events that indicated that certain of Schlumberger’s long-lived intangible and tangible assets may have been impaired.  Recoverability testing indicated that certain long-lived assets were impaired.  The estimated fair value of these assets was determined to be below their carrying value.  As a result, Schlumberger recorded the following impairment charges:

 

-

$3.3 billion relating to intangible assets, of which $2.2 billion relates to Schlumberger’s 2016 acquisition of Cameron International Corporation and $1.1 billion relates to Schlumberger’s 2010 acquisition of Smith International, Inc.  Following this impairment charge, the carrying value of the impaired intangible assets was approximately $0.9 billion.

 

-

$1.3 billion relating to the carrying value of certain Asset Performance Solutions (“APS”) projects in North America.

 

-

$0.6 billion of fixed assets associated with the pressure pumping business in North America.  

 

 

$202 million of severance.

 

10


 

 

$79 million of other restructuring charges, primarily consisting of the impairment of an equity method investment that was determined to be other-than-temporarily impaired.

 

 

$164 million relating to a valuation allowance against certain deferred tax assets.

 

Second quarter 2020:

 

 

As previously noted, late in the first quarter of 2020 geopolitical events that increased the supply of low-priced oil to the global market occurred at the same time as demand weakened due to the worldwide effects of the COVID-19 pandemic, which led to a collapse in oil prices.  As a result, the second quarter of 2020 was the most challenging quarter in decades.  Schlumberger responded to these market conditions by taking actions to restructure its business and rationalize its asset base during the second quarter of 2020.  These actions included reducing headcount, closing facilities and exiting business lines in certain countries.  Additionally, due to the resulting activity decline, Schlumberger had assets that would no longer be utilized.  As a consequence of these circumstances and decisions, Schlumberger recorded the following restructuring and asset impairment charges:

 

-

$1.021 billion of severance associated with reducing its workforce by more than 21,000 employees.  

 

-

$730 million relating to the carrying value of certain APS projects in Latin America.

 

-

$666 million of fixed asset impairments primarily relating to equipment that would no longer be utilized and facilities it exited.

 

-

$603 million write-down of the carrying value of inventory to its net realizable value.

 

-

$311 million write-down of right-of-use assets under operating leases associated with leased facilities Schlumberger exited and excess equipment.

 

-

$205 million of costs associated with exiting certain activities.

 

-

$156 million impairment of certain multiclient seismic data.

 

-

$60 million of other costs, including a $42 million increase in the allowance for the doubtful accounts.

 

 

During the second quarter of 2020, Schlumberger repurchased certain Senior Notes (see Note 9 – Long-term Debt), which resulted in a $40 million charge.

 

 

As a consequence of the workforce reductions described above, Schlumberger recorded a curtailment gain of $69 million relating to its US postretirement medical plan.  See Note 13 – Pension and Other Postretirement Benefit Plans for further details.

The fair value of the impaired intangible assets, fixed assets, APS investments, right-of-use assets and multiclient seismic data was estimated based on the present value of projected future cash flows that the underlying assets are expected to generate.  Such estimates included unobservable inputs that required significant judgement.

 

Third quarter 2020:

 

 

During the third quarter of 2020 Schlumberger recorded the following restructuring charges:

 

-

$254 million of facility exit charges as Schlumberger continued to rationalize its real estate footprint relating to both leased and owned facilities.

 

-

$63 million of severance.

 

-

$33 million of other charges.

As market conditions evolve and Schlumberger continues to develop its strategy to deal with such conditions, it may result in further restructuring and/or impairment charges in future periods.

11


 

2019

In connection with the preparation of its third quarter 2019 financial statements, Schlumberger recorded the following charges, all of which are classified as Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

Goodwill

$

8,828

 

 

$

(43

)

 

$

8,785

 

Intangible assets

 

1,085

 

 

 

(248

)

 

 

837

 

North America pressure pumping

 

1,575

 

 

 

(344

)

 

 

1,231

 

Other North America-related

 

310

 

 

 

(53

)

 

 

257

 

Argentina

 

127

 

 

 

-

 

 

 

127

 

Equity-method investments

 

231

 

 

 

(12

)

 

 

219

 

Asset Performance Solutions investments

 

294

 

 

 

-

 

 

 

294

 

Other

 

242

 

 

 

(13

)

 

 

229

 

 

$

12,692

 

 

$

(713

)

 

$

11,979

 

 

 

During August 2019, Schlumberger’s market capitalization deteriorated significantly compared to the end of the second quarter of 2019.  Schlumberger’s stock price reached a low not seen since 2005.  Additionally, the Philadelphia Oil Services Sector Index, which is comprised of companies involved in the oil services sector, reached an 18-year low.

As a result of these facts, Schlumberger determined that it was more likely than not that the fair value of certain of its reporting units were less than their carrying value.  Therefore, Schlumberger performed an interim goodwill impairment test as of August 31, 2019.

As of August 31, 2019, Schlumberger had 17 reporting units with goodwill balances aggregating $25.0 billion.  Schlumberger determined that the fair value of seven of its reporting units, representing approximately $13.8 billion of the goodwill, was substantially in excess of their carrying value.  Schlumberger performed a detailed quantitative impairment assessment of the remaining 10 reporting units, which represented $11.2 billion of goodwill. As a result of this assessment, Schlumberger concluded that the goodwill associated with nine of the 10 reporting units was impaired, resulting in an $8.8 billion goodwill impairment charge.  This charge primarily relates to Schlumberger’s Drilling and Cameron segments.

Following the $8.8 billion goodwill impairment charge relating to these nine reporting units, only three had a remaining goodwill balance.  These three reporting units had goodwill balances which ranged between $0.4 billion and $0.6 billion and aggregated to $1.5 billion as of August 31, 2019. The tenth reporting unit, which was determined not to be impaired, had $0.9 billion of goodwill.

Schlumberger primarily used the income approach to estimate the fair value of its reporting units, but also considered the market approach to validate the results.  The income approach estimates the fair value by discounting each reporting unit’s estimated future cash flows using Schlumberger’s estimate of the discount rate, or expected return, that a marketplace participant would have required as of the valuation date.  The market approach includes the use of comparative multiples to corroborate the discounted cash flow results.  The market approach involves significant judgement involved in the selection of the appropriate peer group companies and valuation multiples.

Some of the more significant assumptions inherent in the income approach include the estimated future net annual cash flows for each reporting unit and the discount rate.  Schlumberger selected the assumptions used in the discounted cash flow projections using historical data supplemented by current and anticipated market conditions and estimated growth rates.  Schlumberger’s estimates are based upon assumptions believed to be reasonable.  However, given the inherent uncertainty in determining the assumptions underlying a discounted cash flow analysis, actual results may differ from those used in Schlumberger’s valuations which could result in additional impairment charges in the future.

The discount rates utilized to value Schlumberger’s reporting units were between 12.5% and 14.0%, depending on the risks and uncertainty inherent in the respective reporting unit.  Assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50 basis point increase in the discount rate assumption would have increased the goodwill impairment charge by approximately $0.3 billion.  Conversely, assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50 basis point decrease in the discount rate assumption would have decreased the goodwill impairment charge by approximately $0.4 billion.

12


 

 

The negative market indicators described above, combined with deteriorating market conditions in North America, as well as the results of the previously mentioned fair value determinations of certain of Schlumberger’s reporting units and the appointment of a new Chief Executive Officer (as described below), were all triggering events that indicated that certain of Schlumberger’s long-lived tangible and intangible assets may have been impaired.

Recoverability testing, which was performed as of August 31, 2019, indicated that long-lived assets associated with certain asset groups were impaired.  The estimated fair value of these asset groups was determined to be below their carrying value.  As a result, Schlumberger recorded the following impairment and related charges:

 

-

$1.085 billion of intangible assets, of which $842 million related to Schlumberger’s 2010 acquisition of Smith International, Inc.  The remaining $243 million primarily related to other acquisitions in North America.

 

-

$1.575 billion of charges relating to Schlumberger’s pressure pumping business in North America.  This amount consisted of $1.324 billion of pressure pumping equipment and related assets; $98 million of right-of-use assets under operating leases; $121 million relating to a supply contract; $19 million of inventory; and $13 million of severance.

 

-

$310 million of charges primarily relating to other businesses in North America, consisting of $230 million of fixed asset impairments, $70 million of inventory write-downs and $10 million of severance.

 

 

As a result of the ongoing economic challenges in Argentina, Schlumberger recorded $127 million of charges during the third quarter of 2019.  This consisted of $72 million of asset impairments, a $26 million devaluation charge and $29 million of severance.

 

 

Schlumberger also recorded the following impairment and restructuring charges:

 

-

$231 million relating to certain equity method investments that were determined to be other-than-temporarily impaired.

 

-

$294 million impairment relating to the carrying value of certain smaller APS projects.

 

-

$242 million of restructuring charges consisting of: $62 million of severance; $57 million relating to the acceleration of stock-based compensation expense associated with certain individuals; $49 million of business divestiture costs; $29 million relating to the repurchase of certain Senior Notes (see Note 9 - Long-term Debt); and $45 million of other provisions.

The fair value of certain of these impaired assets was estimated based on the present value of projected future cash flows that the underlying assets were expected to generate.  Such estimates included unobservable inputs that required significant judgment.

There were no charges or credits recorded during the first six months of 2019.

13


 

3.   Loss Per Share

The following is a reconciliation from basic loss per share of Schlumberger to diluted loss per share of Schlumberger:

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Third Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Nine Months

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

 

The number of outstanding options to purchase shares of Schlumberger common stock that were not included in the computation of diluted loss per share, because to do so would have had an antidilutive effect, was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

2019

 

 

2020

 

2019

 

Employee stock options

49

 

47

 

 

49

 

 

40

 

Unvested restricted stock

18

 

 

-

 

 

18

 

 

-

 

 

4.   Inventories

A summary of inventories, which are stated at the lower of average cost or net realizable value, is as follows:  

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Raw materials & field materials

$

1,609

 

 

$

1,857

 

Work in progress

 

520

 

 

 

515

 

Finished goods

 

1,413

 

 

 

1,758

 

 

$

3,542

 

 

$

4,130

 

 

14


 

5.   Fixed Assets

A summary of fixed assets follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Property, plant & equipment

$

32,128

 

 

$

35,009

 

Less: Accumulated depreciation

 

24,732

 

 

 

25,739

 

 

$

7,396

 

 

$

9,270

 

 

Depreciation expense relating to fixed assets was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

385

 

 

$

499

 

Nine Months

$

1,251

 

 

$

1,525

 

 

 

6.   Multiclient Seismic Data

The change in the carrying amount of multiclient seismic data for the nine months ended September 30, 2020 was as follows:

 

(Stated in millions)

 

 

 

 

 

Balance at December 31, 2019

$

568

 

Capitalized in period

 

86

 

Charged to expense

 

(132

)

Impairments (See Note 2)

 

(156

)

Other

 

(22

)

 

$

344

 

 

7.   Goodwill

The changes in the carrying amount of goodwill by segment were as follows:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reservoir

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Characterization

 

 

Drilling

 

 

Production

 

 

Cameron

 

 

Total

 

Balance at December 31, 2019

$

4,560

 

 

$

7,092

 

 

$

3,949

 

 

$

441

 

 

$

16,042

 

Impairment (See Note 2)

 

-

 

 

 

(1,659

)

 

 

(1,228

)

 

 

(183

)

 

 

(3,070

)

Impact of changes in exchange rates and other

 

-

 

 

 

10

 

 

 

(17

)

 

 

3

 

 

 

(4

)

Balance at September 30, 2020

$

4,560

 

 

$

5,443

 

 

$

2,704

 

 

$

261

 

 

$

12,968

 

 

15


 

8.   Intangible Assets

The gross book value, accumulated amortization and net book value of intangible assets were as follows:

 

 

(Stated in millions)

 

 

 

 

 

Sept. 30, 2020

 

 

Dec. 31, 2019

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Book Value

 

 

Amortization

 

 

Value

 

 

Book Value

 

 

Amortization

 

 

Value

 

Customer relationships

$

1,744

 

 

$

467

 

 

$

1,277

 

 

$

3,779

 

 

$

868

 

 

$

2,911

 

Technology/technical know-how

 

1,290

 

 

 

467

 

 

 

823

 

 

 

2,498

 

 

 

779

 

 

 

1,719

 

Tradenames

 

767

 

 

 

157

 

 

 

610

 

 

 

1,885

 

 

 

264

 

 

 

1,621

 

Other

 

1,548

 

 

 

685

 

 

 

863

 

 

 

1,514

 

 

 

676

 

 

 

838

 

 

$

5,349

 

 

$

1,776

 

 

$

3,573

 

 

$

9,676

 

 

$

2,587

 

 

$

7,089

 

 

Amortization expense charged to income was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

79

 

 

$

156

 

Nine Months

$

292

 

 

$

480

 

 

Based on the net book value of intangible assets at September 30, 2020, amortization charged to income for the subsequent five years is estimated to be: fourth quarter of 2020—$81 million; 2021—$305 million; 2022—$298 million; 2023—$286 million; 2024—$259 million; and 2025—$252 million.

 

16


 

9.   Long-term Debt

A summary of Long-term Debt follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

3.65% Senior Notes due 2023

$

1,496

 

 

$

1,495

 

3.90% Senior Notes due 2028

 

1,449

 

 

 

1,444

 

1.375% Guaranteed Notes due 2026

 

1,163

 

 

 

-

 

2.00% Guaranteed Notes due 2032

 

1,163

 

 

 

-

 

0.25% Notes due 2027

 

1,058

 

 

 

550

 

0.50% Notes due 2031

 

1,058

 

 

 

544

 

2.65% Senior Notes due 2030

 

1,250

 

 

 

-

 

2.40% Senior Notes due 2022

 

999

 

 

 

998

 

4.00% Senior Notes due 2025

 

930

 

 

 

929

 

4.30% Senior Notes due 2029

 

845

 

 

 

845

 

3.75% Senior Notes due 2024

 

746

 

 

 

746

 

1.00% Guaranteed Notes due 2026

 

704

 

 

 

665

 

2.65% Senior Notes due 2022

 

598

 

 

 

598

 

0.00% Notes due 2024

 

588

 

 

 

551

 

1.40% Senior Notes due 2025

 

498

 

 

 

-

 

3.63% Senior Notes due 2022

 

295

 

 

 

294

 

7.00% Notes due 2038

 

206

 

 

 

208

 

5.95% Notes due 2041

 

114

 

 

 

114

 

5.13% Notes due 2043

 

99

 

 

 

99

 

4.00% Notes due 2023

 

80

 

 

 

81

 

3.70% Notes due 2024

 

55

 

 

 

55

 

3.30% Senior Notes due 2021

 

-

 

 

 

1,597

 

4.20% Senior Notes due 2021

 

-

 

 

 

600

 

Commercial paper borrowings

 

1,077

 

 

 

2,222

 

Other

 

-

 

 

 

135

 

 

$

16,471

 

 

$

14,770

 

 

The estimated fair value of Schlumberger’s Long-term Debt, based on quoted market prices at September 30, 2020 and December 31, 2019, was $17.2 billion and $15.3 billion, respectively.

During the second quarter of 2020, Schlumberger entered into a €1.54 billion committed revolving credit facility.  This one-year facility can be extended at Schlumberger’s option for up to an additional year.  At September 30, 2020 no amounts had been drawn under this facility.

At September 30, 2020, Schlumberger had separate committed credit facility agreements aggregating $8.06 billion with commercial banks, of which $6.98 billion was available and unused.  These committed facilities support commercial paper programs in the United States and Europe, of which $1.81 billion matures in April 2021, $2.75 billion matures in February 2023, $2.0 billion matures in February 2025 and $1.5 billion matures in July 2025  .  Interest rates and other terms of borrowing under these lines of credit vary by facility.

Borrowings under the commercial paper programs at September 30, 2020 were $1.08 billion, all of which was classified in Long-term debt in the Consolidated Balance Sheet.  At December 31, 2019, borrowings under the commercial paper programs were $2.22 billion, all of which was classified in Long-term debt in the Consolidated Balance Sheet.

During the first quarter of 2020, Schlumberger issued €400 million of 0.25% Notes due 2027 and €400 million of 0.50% Notes due 2031.

During the second quarter of 2020, Schlumberger issued €1.0 billion of 1.375% Guaranteed Notes due 2026, $900 million of 2.65% Senior Notes due 2030 and €1.0 billion of 2.00% Guaranteed Notes due 2032.

17


 

 

During the second quarter of 2020, Schlumberger repurchased all $600 million of its 4.20% Senior Notes due 2021 and $935 million of its 3.30% Senior Notes due 2021.  Schlumberger paid a premium of approximately $40 million in connection with these repurchases.  This premium was classified in Impairments & other in the Consolidated Statement of Loss.  See Note 2 – Charges and Credits.

 

During the second quarter of 2020, Schlumberger established a €5.0 billion Guaranteed Euro Medium Term Note program that provides for the issuance of various types of debt instruments such as fixed or floating rate notes in euro, US dollar or other currencies.  At September 30, 2020, Schlumberger had not issued any debt under this program.

During the third quarter of 2020, Schlumberger issued $500 million of 1.40% Senior Notes due 2025 and $350 million of 2.65% Senior Notes due 2030.

             

During the third quarter of 2019, Schlumberger issued €500 million of 0.00% Notes due 2024, €500 million of 0.25% Notes due 2027 and €500 million of 0.50% Notes due 2031.

 

In September 2019, Schlumberger repurchased $783 million of its 3.00% Senior Notes due 2020 and $321 million of its 3.625% Senior Notes due 2022. Schlumberger paid a premium of $29 million in connection with these repurchases. This premium was classified as Impairments & other in the Consolidated Statement of Loss. (See Note 2 - Charges and Credits.)

In April 2019, Schlumberger completed a debt exchange offer, pursuant to which it issued $1.500 billion in principal of 3.90% Senior Notes due 2028 (the “New Notes”) in exchange for $401 million of 3.00% Senior Notes due 2020, $234 million of 3.63% Senior Notes due 2022 and $817 million of 4.00% Senior Notes due 2025.  In connection with the exchange of principal, Schlumberger paid a premium of $48 million, substantially all of which was in the form of New Notes.  This premium is being amortized as additional interest expense over the term of the New Notes.

Schlumberger Limited fully and unconditionally guarantees the securities issued by certain of its subsidiaries, including securities issued by Schlumberger Investment SA and Schlumberger Finance Canada Ltd., both wholly-owned subsidiaries of Schlumberger.

10.   Derivative Instruments and Hedging Activities

Schlumberger is exposed to market risks related to fluctuations in foreign currency exchange rates and interest rates.  To mitigate these risks, Schlumberger utilizes derivative instruments.  Schlumberger does not enter into derivative transactions for speculative purposes.

Interest Rate Risk

Schlumberger is subject to interest rate risk on its debt and its investment portfolio.  Schlumberger maintains an interest rate risk management strategy that uses a mix of variable and fixed rate debt combined with its investment portfolio, to mitigate the exposure to changes in interest rates. 

At September 30, 2020, Schlumberger had fixed rate debt aggregating $16.6 billion and variable rate debt aggregating $1.2 billion.

Foreign Currency Exchange Rate Risk

As a multinational company, Schlumberger generates revenue in more than 120 countries. Schlumberger’s functional currency is primarily the US dollar.  However, outside the United States, a significant portion of Schlumberger’s expenses are incurred in foreign currencies.  Therefore, when the US dollar weakens (strengthens) in relation to the foreign currencies of the countries in which Schlumberger conducts business, the US dollar-reported expenses will increase (decrease).  

Schlumberger is exposed to risks on future cash flows to the extent that the local currency is not the functional currency and expenses denominated in local currency are not equal to revenues denominated in local currency.  Schlumberger uses foreign currency forward contracts to provide a hedge against a portion of these cash flow risks.  These contracts are accounted for as cash flow hedges, with the changes in the fair value of the hedge recorded on the Consolidated Balance Sheet and in Accumulated Other Comprehensive Loss.  Amounts recorded in Accumulated Other Comprehensive Loss are reclassified into earnings in the same period or periods that the hedged item is recognized in earnings. 

18


 

Schlumberger is also exposed to risks on future cash flows relating to certain of its fixed rate debt denominated in currencies other than the functional currency. Schlumberger uses cross-currency swaps to provide a hedge against these cash flow risks.

During 2017, a Canadian-dollar functional currency subsidiary of Schlumberger issued $1.1 billion of US-dollar denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of $1.1 billion in order to hedge changes in the fair value of its $0.5 billion of 2.20% Senior Notes due 2020 and its $0.6 billion of 2.65% Senior Notes due 2022.  These cross-currency swaps effectively convert the US-dollar denominated notes to Canadian-dollar denominated debt with fixed annual interest rates of 1.97% and 2.52%, respectively.

During 2019, a US-dollar functional currency subsidiary of Schlumberger issued €1.5 billion of Euro-denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of €1.5 billion in order to hedge changes in the fair value of its €0.5 billion 0.00% Notes due 2024, €0.5 billion 0.25% Notes due 2027 and €0.5 billion 0.50% Notes due 2031. These cross-currency swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.29%, 2.51% and 2.76%, respectively.

During the first quarter of 2020, a US-dollar functional currency subsidiary of Schlumberger issued €0.8 billion of Euro-denominated debt. Schlumberger entered into cross-currency swaps for an aggregate notional amount of €0.8 billion in order to hedge changes in the fair value of its €0.4 billion of 0.25% Notes due 2027 and €0.4 billion of 0.50% Notes due 2031. These cross-currency swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 1.87% and 2.20%, respectively.

During the second quarter of 2020, a US-dollar functional currency subsidiary of Schlumberger issued €2.0 billion of Euro-denominated debt. Schlumberger entered into cross-currency swaps for an aggregate notional amount of €1.85 billion in order to hedge changes in the fair value of its €1.0 billion of 1.375% Guaranteed Notes due 2026 and €0.85 billion of 2.00% Guaranteed Notes due 2032. These cross-currency swaps effectively convert the swapped portion of the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.77% and 3.45%, respectively. Schlumberger hedged its exposure to currency fluctuations on the remaining €0.15 billion of Euro-denominated debt issued by using foreign currency forward contracts that are not designated as hedges for accounting purposes.

During the third quarter of 2020, a Canadian dollar functional currency subsidiary of Schlumberger issued $0.5 billion of US dollar denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of $0.5 billion in order to hedge changes in the fair value of its $0.5 billion 1.40% Senior Notes due 2025. These cross-currency swaps effectively convert the US dollar notes to Canadian dollar denominated debt with a fixed annual interest rate of 1.73%.

Schlumberger is exposed to changes in the fair value of assets and liabilities that are denominated in currencies other than the functional currency.  While Schlumberger uses foreign currency forward contracts and foreign currency options to economically hedge this exposure as it relates to certain currencies, these contracts are not designated as hedges for accounting purposes.  Instead, the fair value of the contracts is recorded on the Consolidated Balance Sheet, and changes in the fair value are recognized in the Consolidated Statement of Loss as are changes in fair value of the hedged item.  

At September 30, 2020, contracts were outstanding for the US dollar equivalent of $10.9 billion in various foreign currencies, of which $6.7 billion relates to hedges of debt denominated in currencies other than the functional currency.

At September 30, 2020, Schlumberger recognized a cumulative $218 million loss in Accumulated Other Comprehensive Loss relating to changes in the fair value of foreign currency forward contracts and cross-currency swaps.

19


 

The effect of derivative instruments designated as cash flow hedges, and those not designated as hedges, on the Consolidated Statement of Loss was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (Loss) Recognized in Loss

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

Consolidated Statement of Loss Classification

Derivatives designated as cash flow hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(7

)

 

$

(3

)

 

$

(12

)

 

$

(7

)

 

Cost of services/sales

Cross currency swaps

 

197

 

 

 

(2

)

 

 

347

 

 

 

(40

)

 

Cost of services/sales

 

$

190

 

 

$

(5

)

 

$

335

 

 

$

(47

)

 

 

Derivatives not designated as hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(14

)

 

$

-

 

 

$

(12

)

 

$

(8

)

 

Cost of services/sales

 

11.   Contingencies

Schlumberger is party to various legal proceedings from time to time.  A liability is accrued when a loss is both probable and can be reasonably estimated.  Management believes that the probability of a material loss with respect to any currently pending legal proceeding is remote.  However, litigation is inherently uncertain and it is not possible to predict the ultimate disposition of any of these proceedings.  

12.   Segment Information

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

Third Quarter 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

1,010

 

 

$

169

 

 

$

1,651

 

 

$

360

 

Drilling

 

1,519

 

 

 

144

 

 

 

2,469

 

 

 

306

 

Production

 

1,801

 

 

 

227

 

 

 

3,153

 

 

 

288

 

Cameron

 

965

 

 

 

60

 

 

 

1,363

 

 

 

173

 

Eliminations & other

 

(37

)

 

 

(25

)

 

 

(95

)

 

 

(31

)

 

 

 

 

 

 

575

 

 

 

 

 

 

 

1,096

 

Corporate & other (1)

 

 

 

 

 

(151

)

 

 

 

 

 

 

(231

)

Interest income (2)

 

 

 

 

 

3

 

 

 

 

 

 

 

7

 

Interest expense (3)

 

 

 

 

 

(131

)

 

 

 

 

 

 

(151

)

Charges and credits (4)

 

 

 

 

 

(350

)

 

 

 

 

 

 

(12,692

)

 

$

5,258

 

 

$

(54

)

 

$

8,541

 

 

$

(11,971

)

 

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($- million in 2020; $1 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($7 million in 2020; $9 million in 2019).

(4)

See Note 2 – Charges and Credits.

20


 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

Nine Months 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

3,372

 

 

$

538

 

 

$

4,669

 

 

$

959

 

Drilling

 

5,540

 

 

 

594

 

 

 

7,275

 

 

 

914

 

Production

 

6,119

 

 

 

464

 

 

 

9,120

 

 

 

740

 

Cameron

 

3,235

 

 

 

262

 

 

 

3,949

 

 

 

486

 

Eliminations & other

 

(197

)

 

 

(111

)

 

 

(324

)

 

 

(127

)

 

 

 

 

 

 

1,747

 

 

 

 

 

 

 

2,972

 

Corporate & other (1)

 

 

 

 

 

(548

)

 

 

 

 

 

 

(742

)

Interest income (2)

 

 

 

 

 

25

 

 

 

 

 

 

 

25

 

Interest expense (3)

 

 

 

 

 

(397

)

 

 

 

 

 

 

(433

)

Charges and credits (4)

 

 

 

 

 

(12,596

)

 

 

 

 

 

 

(12,692

)

 

$

18,069

 

 

$

(11,769

)

 

$

24,689

 

 

$

(10,870

)

 

Certain prior period amounts have been reclassified to conform to the current period presentation.

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($1 million in 2020; $6 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($22 million in 2020; $29 million in 2019).

(4)

See Note 2 – Charges and Credits.

 

Revenue by geographic area was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

North America

$

1,157

 

 

$

2,850

 

 

$

4,620

 

 

$

8,389

 

Latin America

 

707

 

 

 

1,014

 

 

 

2,195

 

 

 

3,121

 

Europe/CIS/Africa

 

1,397

 

 

 

2,062

 

 

 

4,597

 

 

 

5,665

 

Middle East & Asia

 

1,987

 

 

 

2,553

 

 

 

6,559

 

 

 

7,343

 

Eliminations & other

 

10

 

 

 

62

 

 

 

98

 

 

 

171

 

 

$

5,258

 

 

$

8,541

 

 

$

18,069

 

 

$

24,689

 

 

21


 

North America and International revenue disaggregated by segment was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

143

 

 

$

863

 

 

$

4

 

 

$

1,010

 

Drilling

 

226

 

 

 

1,265

 

 

 

28

 

 

 

1,519

 

Production

 

462

 

 

 

1,338

 

 

 

1

 

 

 

1,801

 

Cameron

 

326

 

 

 

646

 

 

 

(7

)

 

 

965

 

Other

 

-

 

 

 

(21

)

 

 

(16

)

 

 

(37

)

 

$

1,157

 

 

$

4,091

 

 

$

10

 

 

$

5,258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

299

 

 

$

1,347

 

 

$

5

 

 

$

1,651

 

Drilling

 

552

 

 

 

1,861

 

 

 

56

 

 

 

2,469

 

Production

 

1,426

 

 

 

1,726

 

 

 

1

 

 

 

3,153

 

Cameron

 

589

 

 

 

772

 

 

 

2

 

 

 

1,363

 

Other

 

(16

)

 

 

(77

)

 

 

(2

)

 

 

(95

)

 

$

2,850

 

 

$

5,629

 

 

$

62

 

 

$

8,541

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

508

 

 

$

2,851

 

 

$

13

 

 

$

3,372

 

Drilling

 

1,018

 

 

 

4,404

 

 

 

118

 

 

 

5,540

 

Production

 

1,937

 

 

 

4,180

 

 

 

2

 

 

 

6,119

 

Cameron

 

1,173

 

 

 

2,048

 

 

 

14

 

 

 

3,235

 

Other

 

(16

)

 

 

(132

)

 

 

(49

)

 

 

(197

)

 

$

4,620

 

 

$

13,351

 

 

$

98

 

 

$

18,069

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

756

 

 

$

3,898

 

 

$

15

 

 

$

4,669

 

Drilling

 

1,680

 

 

 

5,435

 

 

 

160

 

 

 

7,275

 

Production

 

4,218

 

 

 

4,900

 

 

 

2

 

 

 

9,120

 

Cameron

 

1,771

 

 

 

2,146

 

 

 

32

 

 

 

3,949

 

Other

 

(36

)

 

 

(250

)

 

 

(38

)

 

 

(324

)

 

$

8,389

 

 

$

16,129

 

 

$

171

 

 

$

24,689

 

 

 

Revenue in excess of billings related to contracts where revenue is recognized over time was $0.2 billion at both September 30, 2020 and December 31, 2019.  Such amounts are included within Receivables less allowance for doubtful accounts in the Consolidated Balance Sheet.

Due to the nature of its business, Schlumberger does not have significant backlog.  Total backlog was $2.7 billion at September 30, 2020, of which approximately 65% is expected to be recognized as revenue over the next 12 months.

22


 

Billings and cash collections in excess of revenue was $1.0 billion at September 30, 2020 and $0.9 billion at December 31, 2019.  Such amounts are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheet.  

13.   Pension and Other Postretirement Benefit Plans

Net pension cost (credit) for the Schlumberger pension plans included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

Service cost

$

10

 

 

$

31

 

 

$

14

 

 

$

32

 

 

$

41

 

 

$

105

 

 

$

41

 

 

$

96

 

Interest cost

 

36

 

 

 

76

 

 

 

45

 

 

 

82

 

 

 

111

 

 

 

226

 

 

 

136

 

 

 

248

 

Expected return on plan assets

 

(58

)

 

 

(148

)

 

 

(58

)

 

 

(148

)

 

 

(175

)

 

 

(443

)

 

 

(173

)

 

 

(446

)

Amortization of prior service cost

 

2

 

 

 

-

 

 

 

3

 

 

 

2

 

 

 

6

 

 

 

-

 

 

 

7

 

 

 

6

 

Amortization of net loss

 

9

 

 

 

39

 

 

 

7

 

 

 

16

 

 

 

31

 

 

 

119

 

 

 

23

 

 

 

47

 

 

$

(1

)

 

$

(2

)

 

$

11

 

 

$

(16

)

 

$

14

 

 

$

7

 

 

$

34

 

 

$

(49

)

 

The net periodic benefit credit for the Schlumberger US postretirement medical plan included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Service cost

$

5

 

 

$

8

 

 

$

23

 

 

$

23

 

Interest cost

 

7

 

 

 

12

 

 

 

27

 

 

 

36

 

Expected return on plan assets

 

(19

)

 

 

(16

)

 

 

(52

)

 

 

(49

)

Amortization of prior service credit

 

(4

)

 

 

(7

)

 

 

(19

)

 

 

(21

)

Curtailment gain

 

-

 

 

 

-

 

 

 

(69

)

 

 

-

 

 

$

(11

)

 

$

(3

)

 

$

(90

)

 

$

(11

)

 

Due to the actions taken by Schlumberger to reduce its global workforce during 2020, Schlumberger experienced a significant reduction in the expected aggregate years of future service of its employees in its US postretirement medical plan. Accordingly, Schlumberger recorded a curtailment gain of $69 million during the second quarter of 2020 relating to this plan. The curtailment gain includes recognition of the decrease in the benefit obligation as well as a portion of the previously unrecognized prior service credit, reflecting the reduction in expected years of future service.  As a result of the curtailment, Schlumberger performed a remeasurement of the plan, which had an immaterial impact.  This gain was classified in Impairments & other in the Consolidated Statement of Loss.  See Note 2 – Charges and Credits.

 

23


 

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Third Quarter 2020 Compared to Second Quarter 2020

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

Second Quarter 2020

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

1,010

 

 

$

169

 

 

$

1,052

 

 

$

185

 

Drilling

 

1,519

 

 

 

144

 

 

 

1,731

 

 

 

165

 

Production

 

1,801

 

 

 

227

 

 

 

1,615

 

 

 

25

 

Cameron

 

965

 

 

 

60

 

 

 

1,015

 

 

 

80

 

Eliminations & other

 

(37

)

 

 

(25

)

 

 

(57

)

 

 

(59

)

 

 

 

 

 

 

575

 

 

 

 

 

 

 

396

 

Corporate & other (1)

 

 

 

 

 

(151

)

 

 

 

 

 

 

(169

)

Interest income (2)

 

 

 

 

 

3

 

 

 

 

 

 

 

7

 

Interest expense (3)

 

 

 

 

 

(131

)

 

 

 

 

 

 

(137

)

Charges and credits (4)

 

 

 

 

 

(350

)

 

 

 

 

 

 

(3,724

)

 

$

5,258

 

 

$

(54

)

 

$

5,356

 

 

$

(3,627

)

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.

(2)

Interest income excludes amounts which are included in the segments’ income ($- million in Q3 2020; $- million in Q2 2020).

(3)

Interest expense excludes amounts which are included in the segments’ income ($7 million in Q3 2020; $7 million in Q2 2020).

(4)

Charges and credits are described in detail in Note 2 to the Consolidated Financial Statements.

 

Third-quarter 2020 revenue declined 2% sequentially, as North America revenue was 2% lower and international revenue declined 1%. In North America land, increased completions activity on drilled but uncompleted (“DUC”) wells was offset by reduced drilling in US land. North America offshore was affected by reduced rig activity, lower multiclient seismic license sales, and hurricane disruption.

 

International revenue was driven by higher activity in Latin America, boosted by the resumption of production in the Asset Performance Solutions (“APS”) projects in Ecuador and increased seasonal summer activity in the North Sea and Russia. These increases were offset by the effects of rig count declines and extended COVID-19 disruptions in Africa and in the Middle East & Asia.

 

Looking to the fourth quarter of 2020, Schlumberger expects to continue to benefit from the effectiveness of its strategy, disciplined approach to North America, and broad strength of its international business, as reflected in the third-quarter results. In North America, the conditions are set for continued momentum, with improving DUC well completion activity in US land and a modest drilling resumption in the US and Canada. International activity is steady following the budget resets completed in the third quarter and activity will be affected by the seasonal decline in the Northern Hemisphere, partly offset by muted year-end product and multiclient license sales.

 

Overall internationally, Schlumberger views the next two quarters as a period of transition for our industry at the trough of this cycle. Improving demand recovery supported by various government measures to stimulate economic activity and continued supply discipline from the major producers set the conditions for a long-term activity rebound. However, while the global lockdowns are evolving and vaccine development is progressing, the near-term recovery remains fragile owing to potential subsequent waves of COVID-19 that could pose a significant risk to this outlook.

 

On August 31, 2020, Schlumberger and Liberty Oilfield Services Inc. (“Liberty”) entered into an agreement for the contribution to Liberty of OneStim®, Schlumberger’s onshore hydraulic fracturing business in the United Stated and Canada, including its pressure pumping, pumpdown perforating, and Permian frac sand businesses, in exchange for a 37% equity interest in Liberty.  The transaction is expected to close in the fourth quarter of 2020 and is subject to Liberty stockholder approval and other customary closing conditions.  OneStim represented approximately 5% of Schlumberger’s consolidated revenue for the nine months ended September 30, 2020.

24


 

Reservoir Characterization

Reservoir Characterization revenue of $1.0 billion decreased 4% sequentially. North America and international revenues declined 14% and 2%, respectively. This was mainly due to lower WesternGeco® multiclient seismic license sales in North America offshore. Revenue was also lower in the Middle East due to reduced WesternGeco activity as a result of a completed project and lower Testing Services activity due to project cancellations and delays.

 

Reservoir Characterization pretax operating margin of 17% contracted 90 basis points (“bps”) sequentially due to lower sales of WesternGeco multiclient seismic licenses, which impacted North America margin, while international margin was flat sequentially.

Drilling

Drilling revenue of $1.5 billion decreased 12% sequentially. North America and international revenues declined 16% and 11%, respectively. The revenue decline in North America was primarily due to lower activity in US land as rig count dropped 29%, along with rig count reductions and activity disruptions in the US Gulf of Mexico due to a more active hurricane season. In addition, extended COVID-19 disruptions caused drilling activities to be suspended or deferred in several international GeoMarkets.

 

Drilling pretax operating margin of 10% was essentially flat sequentially, despite the significant revenue decline. Margin was resilient both in North America and internationally supported by prompt cost reduction measures.

Production

Production revenue of $1.8 billion increased 12% sequentially. North America and international revenues increased 13% and 11%, respectively. This was driven primarily by the gradual recovery in DUC well completions activity in US land and the resumption of APS production in Ecuador following a major landslide that led to the rupture of the main pipeline last quarter. OneStim revenue grew more than 50% sequentially as US-market stage counts increased by more than 30%.

 

Production pretax operating margin of 13% expanded by 11 percentage points sequentially. The margin expansion was due to the resumption of production in APS projects in Ecuador and improved profitability across each of Completions, Artificial Lift Solutions, and Well Services, supported by cost reduction measures. OneStim margin improved due to better operating leverage as revenue increased by more than 50%.

Cameron

Cameron revenue of $965 million decreased 5% sequentially primarily due to declines in the long-cycle businesses of OneSubsea® and Drilling Systems, driven by projects ending in Asia and Europe, coupled with the extended COVID-19 disruptions.

 

Cameron pretax operating margin of 6% declined by 162 bps sequentially. The margin contraction was primarily due to the unfavorable mix where contribution from the long-cycle businesses of OneSubsea and Drilling Systems was lower due to reduced activity.

 

 

25


 

Third Quarter 2020 Compared to Third Quarter 2019

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

Third Quarter 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

1,010

 

 

$

169

 

 

$

1,651

 

 

$

360

 

Drilling

 

1,519

 

 

 

144

 

 

 

2,469

 

 

 

306

 

Production

 

1,801

 

 

 

227

 

 

 

3,153

 

 

 

288

 

Cameron

 

965

 

 

 

60

 

 

 

1,363

 

 

 

173

 

Eliminations & other

 

(37

)

 

 

(25

)

 

 

(95

)

 

 

(31

)

 

 

 

 

 

 

575

 

 

 

 

 

 

 

1,096

 

Corporate & other (1)

 

 

 

 

 

(151

)

 

 

 

 

 

 

(231

)

Interest income (2)

 

 

 

 

 

3

 

 

 

 

 

 

 

7

 

Interest expense (3)

 

 

 

 

 

(131

)

 

 

 

 

 

 

(151

)

Charges and credits (4)

 

 

 

 

 

(350

)

 

 

 

 

 

 

(12,692

)

 

$

5,258

 

 

$

(54

)

 

$

8,541

 

 

$

(11,971

)

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.

(2)

Interest income excludes amounts which are included in the segments’ income ($- million in 2020; $1 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($7 million in 2020; $9 million in 2019).

(4)

Charges and credits are described in detail in Note 2 to the Consolidated Financial Statements.

 

Third-quarter 2020 revenue of $5.3 billion was 38% lower compared to the same period last year due to the significant fall in North America activity while international activity dropped due to downward revisions to customer budgets accentuated by COVID-19 disruptions. North America revenue declined 59% reflecting the continued capital discipline of North America operators, who reduced drilling and frac activity. International revenue decreased 27% due to COVID-19-related disruptions, the drop in offshore activity, and reduced customer discretionary spending.

Reservoir Characterization

Third-quarter 2020 revenue of $1.0 billion decreased 39% year-on-year mainly due to lower Wireline and WesternGeco revenues as customers reduced activity due to COVID-19 and cut discretionary spending and exploration in several international GeoMarkets.

 

Year-on-year, pretax operating margin decreased 512 bps to 17% largely due to the revenue declines in Wireline and WesternGeco.

Drilling

Third-quarter 2020 revenue of $1.5 billion decreased 39% year-on-year primarily due to the activity decline in US land as rig count dropped significantly, while COVID-19 disruptions caused drilling activities to be cancelled or suspended in several international GeoMarkets. Revenue was also lower due to the divestiture of the Drilling Tools businesses at the end of the fourth quarter of 2019.

 

Year-on-year, pretax operating margin decreased 292 bps to 10% primarily due to the significant reduction in activity in North America.

Production

Third-quarter 2020 revenue of $1.8 billion decreased 43% year-on-year. This revenue decrease was driven by the sharp drop in OneStim pressure pumping activity in North America land as customers exercised capital discipline and revised budgets downward. Internationally, revenue was affected by COVID-19-related disruptions and reduced customer spending.

 

26


 

Year-on-year, pretax operating margin increased 347 bps to 13% despite the significant drop in revenue. Margin improvement was supported by cost reduction measures and reduced depreciation and amortization following the asset impairment charges relating to OneStim and APS that were recorded in the second quarter of 2020.

 

Cameron

Third-quarter 2020 revenue of $1.0 billion decreased 29% year-on-year primarily as a result of lower Valves & Process Systems and Surface Systems revenues in North America.

 

Year-on-year, pretax operating margin decreased 644 bps to 6% due to reduced Surface Systems and Valves & Process Systems profitability in North America and lower OneSubsea margins internationally.

Nine Months 2020 Compared to Nine Months 2019

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

Nine Months 2019

 

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

 

$

3,372

 

 

$

538

 

 

$

4,669

 

 

$

959

 

Drilling

 

 

5,540

 

 

 

594

 

 

 

7,275

 

 

 

914

 

Production

 

 

6,119

 

 

 

464

 

 

 

9,120

 

 

 

740

 

Cameron

 

 

3,235

 

 

 

262

 

 

 

3,949

 

 

 

486

 

Eliminations & other

 

 

(197

)

 

 

(111

)

 

 

(324

)

 

 

(127

)

 

 

 

 

 

 

 

1,747

 

 

 

 

 

 

 

2,972

 

Corporate & other (1)

 

 

 

 

 

 

(548

)

 

 

 

 

 

 

(742

)

Interest income (2)

 

 

 

 

 

 

25

 

 

 

 

 

 

 

25

 

Interest expense (3)

 

 

 

 

 

 

(397

)

 

 

 

 

 

 

(433

)

Charges and credits (4)

 

 

 

 

 

 

(12,596

)

 

 

 

 

 

 

(12,692

)

 

 

$

18,069

 

 

$

(11,769

)

 

$

24,689

 

 

$

(10,870

)

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.

(2)

Interest income excludes amounts which are included in the segments’ income ($1 million in 2020; $6 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($22 million in 2020; $29 million in 2019).

(4)

Charges and credits are described in detail in Note 2 to the Consolidated Financial Statements.

Nine-month 2020 revenue of $18.1 billion was 27% lower compared to the same period last year due to the significant fall in North America activity, as well as the international activity drop due to downward revisions to customer budgets accentuated by COVID-19 disruptions.

 

North America revenue declined 45%, reflecting the continued capital discipline of North America operators, who reduced drilling and frac activity.  International revenue decreased 17%.  The decline was most prominent in Latin America, Europe, and Africa due to COVID-19-related restrictions, the drop in offshore activity, and the effect of the APS production interruption in Ecuador during the second quarter of 2020.

Reservoir Characterization

Nine-month 2020 revenue of $3.4 billion decreased 28% year-on-year primarily due to lower Wireline and WesternGeco revenue as customers reduced activity due to COVID-19 and cut discretionary spending and exploration in several international GeoMarkets.

 

Year-on-year, pretax operating margin decreased 459 bps to 16% due to reduced profitability largely in Wireline and WesternGeco.

27


 

Drilling

Nine-month 2020 revenue of $5.5 billion decreased 24% year-on-year due to the activity decline in US land as rig count decreased significantly, while COVID-19 disruptions caused drilling activities to be cancelled or suspended in several international GeoMarkets. Revenue was also lower due to the divestiture of the Drilling Tools businesses at the end of the fourth quarter of 2019.

 

Year-on-year, pretax operating margin decreased 184 bps to 11% primarily due to the decrease in revenue and COVID-19-related disruptions.

Production

Nine-month 2020 revenue of $6.1 billion decreased 33% year-on-year. This revenue decrease was primarily driven by the sharp drop in OneStim pressure-pumping activity in North America land, lower APS revenue due to the significant production interruption in Ecuador during the second quarter of 2020 and COVID-19-related disruptions.

 

Year-on-year, pretax operating margin was essentially flat at 8% despite the significant drop in revenue. The margin was resilient as it was supported by cost reduction measures as well as reduced depreciation and amortization following the asset impairment charges relating to OneStim and APS that were recorded in the second quarter of 2020.

Cameron

Nine-month 2020 revenue of $3.2 billion decreased 18% year-on-year driven by lower Valves & Process Systems and Surface Systems revenue in North America.

 

Year-on-year, pretax operating margin decreased 421 bps to 8% due to the revenue decline.

Interest and Other Income

Interest & other income consisted of the following:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Equity in net earnings of affiliated companies

$

19

 

 

$

13

 

 

$

66

 

 

$

30

 

Interest income

 

3

 

 

 

8

 

 

 

28

 

 

 

31

 

 

$

22

 

 

$

21

 

 

$

94

 

 

$

61

 

 

The increases in earnings from equity method investments primarily relates to higher income associated with Schlumberger’s equity investments in rig- and seismic-related businesses.

 

Other

Research & engineering and General & administrative expenses, as a percentage of Revenue, for the third quarter and nine months ended September 30, 2020 and 2019 were as follows:

 

  

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Research & engineering

 

2.6

%

 

 

2.1

%

 

 

2.5

%

 

 

2.1

%

General & administrative

 

1.6

%

 

 

1.4

%

 

 

1.6

%

 

 

1.4

%

 

The effective tax rate for the third quarter of 2020 was (35)%, as compared to 5% for the same period of 2019.  The charges described in Note 2 to the Consolidated Financial Statements reduced the effective tax rate by 55 and 11 percentage points for the third quarter of 2020 and 2019, respectively, as a significant portion of these charges were not tax-effective.  Changes in the geographic mix of pretax earnings accounted for the remaining increase in the effective tax rate for the third quarter of 2020 as compared to the same period of 2019. 

 

28


 

The effective tax rate for first nine months of 2020 was 8% as compared to 4% for the same period of 2019.  The charges and credits described in Note 2 to the Consolidated Financial Statements reduced the effective tax rate by 11 and 12 percentage points for the first nine months of 2020 and 2019, respectively, as a significant portion of these charges were not tax-effective.  Changes in the geographic mix of pretax earnings accounted for the remaining increase in the effective tax rate for the first nine months of 2020 as compared to the same period of 2019. 

Charges and Credits

Schlumberger recorded the following charges and credits during 2020, which are fully described in Note 2 to the Consolidated Financial Statements:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

First quarter:

 

 

 

 

 

 

 

 

 

 

 

Goodwill

$

3,070

 

 

$

-

 

 

$

3,070

 

Intangible asset impairments

 

3,321

 

 

 

(815

)

 

 

2,506

 

Asset Performance Solutions investments

 

1,264

 

 

 

4

 

 

 

1,268

 

North America pressure pumping impairment

 

587

 

 

 

(133

)

 

 

454

 

Workforce reductions

 

202

 

 

 

(7

)

 

 

195

 

Other

 

79

 

 

 

(9

)

 

 

70

 

Valuation allowance

 

-

 

 

 

164

 

 

 

164

 

Second quarter:

 

 

 

 

 

 

 

 

 

 

 

Workforce reductions

 

1,021

 

 

 

(71

)

 

 

950

 

Asset Performance Solutions investments

 

730

 

 

 

(15

)

 

 

715

 

Fixed asset impairments

 

666

 

 

 

(52

)

 

 

614

 

Inventory write-downs

 

603

 

 

 

(49

)

 

 

554

 

Right-of-use asset impairments

 

311

 

 

 

(67

)

 

 

244

 

Costs associated with exiting certain activities

 

205

 

 

 

25

 

 

 

230

 

Multiclient seismic data impairment

 

156

 

 

 

(2

)

 

 

154

 

Repurchase of bonds

 

40

 

 

 

(2

)

 

 

38

 

Postretirement benefits curtailment gain

 

(69

)

 

 

16

 

 

 

(53

)

Other

 

60

 

 

 

(4

)

 

 

56

 

Third quarter:

 

 

 

 

 

 

 

 

 

 

 

Facility exit charges

 

254

 

 

 

(39

)

 

 

215

 

Workforce reductions

 

63

 

 

 

-

 

 

 

63

 

Other

 

33

 

 

 

(1

)

 

 

32

 

 

$

12,596

 

 

$

(1,057

)

 

$

11,539

 

 

The first quarter 2020 results did not include any benefit from reduced depreciation and amortization expense as a result of the first quarter impairment charges.  However, commencing with the second quarter of 2020, depreciation and amortization expense was reduced by approximately $95 million on a quarterly basis as a result of the first quarter impairment charges.  Approximately $45 million of this quarterly reduction is reflected in the Production segment, with the remaining $50 million reflected in the “Corporate & other” line item.

 

The second quarter 2020 results did not include any benefit from reduced expenses associated with the second quarter restructuring and impairment charges. However, commencing with the third quarter of 2020, depreciation and amortization expense was reduced by approximately $80 million and lease expense was reduced by $25 million, on a quarterly basis.  Approximately $70 million of this quarterly reduction is reflected in the Production Segment, with the remaining $35 million reflected amongst the Reservoir Characterization, Drilling and Cameron segments.

 

The third quarter 2020 results did not include any benefit from reduced expenses associated with the third quarter restructuring charges. However, going forward depreciation and lease expense will be reduced by $15 million, on a quarterly basis. This quarterly reduction will be reflected amongst all of the segments.

 

29


 

2019

Schlumberger recorded the following charges in connection with the preparation of its third quarter 2019 financial statements, which are fully described in Note 2 to the Consolidated Financial Statements, all of which are classified in Impairment & other in the Consolidated Statement of Loss:  

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

Goodwill

$

8,828

 

 

$

(43

)

 

$

8,785

 

Intangible assets

 

1,085

 

 

 

(248

)

 

 

837

 

North America pressure pumping

 

1,575

 

 

 

(344

)

 

 

1,231

 

Other North America-related

 

310

 

 

 

(53

)

 

 

257

 

Argentina

 

127

 

 

 

-

 

 

 

127

 

Equity-method investments

 

231

 

 

 

(12

)

 

 

219

 

Asset Performance Solutions investments

 

294

 

 

 

-

 

 

 

294

 

Other

 

242

 

 

 

(13

)

 

 

229

 

 

$

12,692

 

 

$

(713

)

 

$

11,979

 

 

As these impairment charges were effective as of August 31, 2019, the third quarter 2019 results include a one-month reduction in depreciation and amortization expense of $27 million.  Approximately $21 million of this amount relates to the Production segment.  The remaining $6 million is reflected in the “Corporate & other” line item.

There were no charges or credits recorded during the first six months of 2019.

 

As market conditions evolve and Schlumberger continues to develop its strategy to deal with such conditions, it may result in further restructuring and/or impairment charges in future periods.

Liquidity and Capital Resources

The effects of the COVID-19 pandemic have resulted in a significant and swift reduction in international and U.S. economic activity. These effects have adversely affected the demand for oil and natural gas, as well as for Schlumberger’s products and services, and caused significant volatility and disruption of the financial markets. This period of extreme economic disruption, low oil prices and reduced demand for Schlumberger’s products and services has had, and is likely to continue to have, a material adverse impact on Schlumberger’s business, results of operations, financial condition and, at times, access to sources of liquidity.

In view of the uncertainty of the depth and extent of the contraction in oil demand due to the COVID-19 pandemic combined with the weaker commodity price environment, Schlumberger has turned its strategic focus to cash conservation and protecting its balance sheet. As a result, in April 2020 Schlumberger announced a 75% reduction to its quarterly cash dividend. The revised dividend supports Schlumberger’s value proposition through a balanced approach of shareholder distributions and organic investment, while providing the flexibility to weather the uncertain environment. This decision reflects the Company’s focus on its capital stewardship program as well as its commitment to maintain both a strong liquidity position and a strong investment grade credit rating that provides privileged access to the financial markets.

Details of the components of liquidity as well as changes in liquidity follow: 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Sept. 30,

 

 

Dec. 31,

 

Components of Liquidity:

2020

 

 

2019

 

 

2019

 

Cash

$

1,219

 

 

$

1,183

 

 

$

1,137

 

Short-term investments

 

2,618

 

 

 

1,109

 

 

 

1,030

 

Short-term borrowings and current portion of long-term debt

 

(1,292

)

 

 

(340

)

 

 

(524

)

Long-term debt

 

(16,471

)

 

 

(16,333

)

 

 

(14,770

)

Net debt (1)

$

(13,926

)

 

$

(14,381

)

 

$

(13,127

)

 

30


 

 

 

Nine Months Ended Sept. 30,

 

Changes in Liquidity:

2020

 

 

2019

 

Net loss

$

(10,868

)

 

$

(10,450

)

Impairment and other charges

 

12,596

 

 

 

12,692

 

Depreciation and amortization (2)

 

1,983

 

 

 

2,741

 

Earnings of equity method investments, less dividends received

 

(18

)

 

 

2

 

Deferred taxes

 

(1,147

)

 

 

(833

)

Stock-based compensation expense

 

318

 

 

 

329

 

Increase in working capital (3)

 

(822

)

 

 

(1,340

)

Other

 

24

 

 

 

38

 

Cash flow from operations

 

2,066

 

 

 

3,179

 

Capital expenditures

 

(858

)

 

 

(1,230

)

APS investments

 

(252

)

 

 

(526

)

Multiclient seismic data costs capitalized

 

(86

)

 

 

(181

)

Free cash flow (4)

 

870

 

 

 

1,242

 

Dividends paid

 

(1,560

)

 

 

(2,077

)

Proceeds from employee stock plans

 

146

 

 

 

196

 

Stock repurchase program

 

(26

)

 

 

(278

)

Business acquisitions and investments, net of cash acquired plus debt assumed

 

(33

)

 

 

(21

)

Net proceeds from divestitures

 

325

 

 

 

-

 

Impact of changes in foreign exchange rates on net debt

 

(372

)

 

 

(87

)

Other

 

(149

)

 

 

(82

)

Increase in net debt

 

(799

)

 

 

(1,107

)

Net debt, beginning of period

 

(13,127

)

 

 

(13,274

)

Net debt, end of period

$

(13,926

)

 

$

(14,381

)

 

(1)

Net debt” represents gross debt less cash and short-term investments.  Management believes that Net debt provides useful information regarding the level of Schlumberger’s indebtedness by reflecting cash and investments that could be used to repay debt.  Net debt is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, total debt.

(2)

Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.

(3)

Includes severance payments of approximately $699 million and $104 million during the nine months ended September 30, 2020 and 2019, respectively.

(4)

“Free cash flow” represents cash flow from operations less capital expenditures, APS investments and multiclient seismic data costs capitalized. Management believes that free cash flow is an important liquidity measure for the company and that it is useful to investors and management as a measure of our ability to generate cash.  Once business needs and obligations are met, this cash can be used to reinvest in the company for future growth or to return to shareholders through dividend payments or share repurchases.  Free cash flow does not represent the residual cash flow available for discretionary expenditures.  Free cash flow is a non-GAAP financial measure that should be considered in addition to, not as substitute for or superior to, cash flow from operations.

Key liquidity events during the first nine months of 2020 and 2019 included:

On January 21, 2016, the Board approved a $10 billion share repurchase program for Schlumberger common stock.  Schlumberger had repurchased $1.0 billion of Schlumberger common stock under this program as of September 30, 2020.  The Company did not repurchase any Schlumberger common stock during the third quarter of 2020.  

The following table summarizes the activity under the share repurchase program:

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total cost

 

 

Total number

 

 

Average price

 

 

of shares

 

 

of shares

 

 

paid per

 

 

purchased

 

 

purchased

 

 

share

 

Nine months ended September 30, 2020

$

26

 

 

 

0.8

 

 

$

33.81

 

Nine months ended September 30, 2019

$

278

 

 

 

7.0

 

 

$

39.92

 

 

31


 

Capital expenditures were $0.9 billion during the first nine months of 2020 compared to $1.2 billion during the first nine months of 2019, respectively.  Capital expenditures for full-year 2020 are expected to be approximately $1.1 billion, representing a 35% decrease as compared to 2019.

 

During the third quarter of 2020, Schlumberger issued $500 million of 1.40% Senior Notes due 2025 and $350 million of 2.65% Senior Notes due 2030.

 

During the third quarter of 2019, Schlumberger issued €500 million of 0.00% Notes due 2024, €500 million of 0.25% Notes due 2027 and €500 million of 0.50% Notes due 2031.

 

During the second quarter of 2020, Schlumberger issued €1.0 billion of 1.375% Guaranteed Notes due 2026, $900 million of 2.650% Senior Notes due 2030 and €1.0 billion of 2.00% Guaranteed Notes due 2032.

 

During the second quarter of 2020, Schlumberger repurchased all $600 million of its 4.20% Senior Notes due 2021 and $935 million of its 3.30% Senior Notes due 2021.  Schlumberger paid a premium of approximately $40 million in connection with these repurchases.  This premium was classified in Impairments & other in the Consolidated Statement of Loss.  See Note 2 – Charges and Credits.

 

During the second quarter of 2020, Schlumberger established a €5.0 billion Guaranteed Euro Medium Term Note program that provides for the issuance of various types of debt instruments such as fixed or floating rate notes in euro, US dollar or other currencies.  Schlumberger has not issued any debt under this program.

 

During the first quarter of 2020, Schlumberger issued €400 million of 0.25% Notes due 2027 and €400 million of 0.50% Notes due 2031.

 

During the first quarter of 2020, Schlumberger completed the sale of its 49% interest in the Bandurria Sur Block in Argentina.  The net cash proceeds from this transaction, combined with the proceeds received from the divestiture of a smaller APS project, amounted to $298 million.

 

During the first quarter of 2019, Schlumberger issued $750 million of 3.75% Senior Notes due 2024 and $850 million of 4.30% Senior Notes due 2029.

 

Schlumberger had a provision of $0.7 billion relating to the severance recorded on its Consolidated Balance Sheet as of September 30, 2020.  Approximately half of this balance is expected to be paid during the fourth quarter of 2020 with the remainder expected to be paid in 2021.

Schlumberger generates revenue in more than 120 countries.  As of September 30, 2020, six of those countries individually accounted for greater than 5% of Schlumberger’s net receivables balance.  The United States and Mexico each accounted for greater than 10% of such receivables.

As of September 30, 2020, Schlumberger had $3.8 billion of cash and short-term investments on hand.  Schlumberger had separate committed debt facility agreements aggregating $8.1 billion that support commercial paper programs, of which $7.0 billion was available and unused.  Schlumberger believes these amounts are sufficient to meet future business requirements for at least the next 12 months.

 

Borrowings under the commercial paper programs at September 30, 2020 were $1.1 billion.

FORWARD-LOOKING STATEMENTS

This third-quarter 2020 Form 10-Q, as well as other statements we make, contain “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts, such as our forecasts or expectations regarding business outlook; growth for Schlumberger as a whole and for each of its divisions (and for specified business lines or geographic areas within each division); oil and natural gas demand and production growth; oil and natural gas prices; pricing; Schlumberger’s response to, and preparedness for, the COVID-19 pandemic and other widespread health emergencies; access to raw materials; improvements in operating procedures and technology; capital expenditures by Schlumberger and the oil and gas industry; the business strategies of Schlumberger and Schlumberger’s customers; Schlumberger’s digital strategy; Schlumberger’s strategy for its North America operations; the expected benefits of, or timing to complete, the proposed OneStim transaction; Schlumberger’s

32


 

restructuring efforts and charges recorded as a result of such efforts; our effective tax rate; Schlumberger’s APS projects, joint ventures, and alliances; future global economic and geopolitical conditions; and future results of operations, such as margin levels. These statements are subject to risks and uncertainties, including, but not limited to, changing global economic conditions; changes in exploration and production spending by Schlumberger’s customers and changes in the level of oil and natural gas exploration and development; the results of operations and financial condition of Schlumberger’s customers and suppliers, particularly during extended periods of low prices for crude oil and natural gas; Schlumberger’s inability to achieve its financial and performance targets and other forecasts and expectations; Schlumberger’s inability to sufficiently monetize assets; the extent of future charges; general economic, geopolitical, and business conditions in key regions of the world; foreign currency risk; pricing pressure; weather and seasonal factors; unfavorable effects of health pandemics; availability and cost of raw materials; operational modifications, delays or cancellations; challenges in Schlumberger’s supply chain; production declines; Schlumberger’s inability to recognize intended benefits from its business strategies and initiatives, such as digital or new energy, as well as its restructuring and structural cost reduction plans; changes in government regulations and regulatory requirements, including those related to offshore oil and gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services and climate-related initiatives; the inability of technology to meet new challenges in exploration; the competitiveness of alternative energy sources or product substitutes; and other risks and uncertainties detailed in this Form 10-Q and our most recent Form 10-K and Forms 8-K filed with or furnished to the SEC. If one or more of these or other risks or uncertainties materialize (or the consequences of any such development changes), or should our underlying assumptions prove incorrect, actual outcomes may vary materially from those reflected in our forward-looking statements. Statements in this third-quarter 2020 Form 10-Q are made as of October 21, 2020, and Schlumberger disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

For quantitative and qualitative disclosures about market risk affecting Schlumberger, see Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” of the Schlumberger Annual Report on Form 10-K for the fiscal year ended December 31, 2019. Schlumberger’s exposure to market risk has not changed materially since December 31, 2019.  

Item 4. Controls and Procedures.

Schlumberger has carried out an evaluation under the supervision and with the participation of Schlumberger’s management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the effectiveness of Schlumberger’s “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report. Based on this evaluation, the CEO and the CFO have concluded that, as of the end of the period covered by this report, Schlumberger’s disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the reports that Schlumberger files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Schlumberger’s disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is accumulated and communicated to its management, including the CEO and the CFO, as appropriate, to allow timely decisions regarding required disclosure. There was no change in Schlumberger’s internal control over financial reporting during the quarter to which this report relates that has materially affected, or is reasonably likely to materially affect, Schlumberger’s internal control over financial reporting.

33


 

PART II. OTHER INFORMATION

 

The information with respect to this Item 1 is set forth under Note 11—Contingencies, in the accompanying Consolidated Financial Statements.

 

Item 1A. Risk Factors.

As of the date of this filing, there have been no material changes from the risk factors disclosed in Part 1, Item 1A, of Schlumberger’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, other than the risk factor disclosed in Item 8.01 of Schlumberger’s Current Report on Form 8-K filed on April 17, 2020, which is hereby incorporated by reference into this Quarterly Report on Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

None.

Issuer Repurchases of Equity Securities

As of September 30, 2020, Schlumberger had repurchased $1.0 billion of Schlumberger common stock under its $10 billion share repurchase program. Schlumberger did not repurchase any of its common stock during the third quarter of 2020.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Our mining operations are subject to regulation by the federal Mine Safety and Health Administration under the Federal Mine Safety and Health Act of 1977. Information concerning mine safety violations or other regulatory matters required by section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this report.    

Item 5. Other Information.

In 2013, Schlumberger completed the wind down of its service operations in Iran. Prior to this, certain non-US subsidiaries provided oilfield services to the National Iranian Oil Company and certain of its affiliates (“NIOC”).

Schlumberger’s residual transactions or dealings with the government of Iran during the third quarter of 2020 consisted of payments of taxes and other typical governmental charges. Certain non-US subsidiaries of Schlumberger maintain depository accounts at the Dubai branch of Bank Saderat Iran (“Saderat”), and at Bank Tejarat (“Tejarat”) in Tehran and in Kish for the deposit by NIOC of amounts owed to non-US subsidiaries of Schlumberger for prior services rendered in Iran and for the maintenance of such amounts previously received. One non-US subsidiary also maintained an account at Tejarat for payment of local expenses such as taxes. Schlumberger anticipates that it will discontinue dealings with Saderat and Tejarat following the receipt of all amounts owed to Schlumberger for prior services rendered in Iran.

 

34


 

Item 6. Exhibits.

 

 

Exhibit 3.1—Articles of Incorporation of Schlumberger Limited (Schlumberger N.V.) (incorporated by reference to Exhibit 3.1 to Schlumberger’s Current Report on Form 8-K filed on April 6, 2016)

 

Exhibit 3.2—Amended and Restated By-laws of Schlumberger Limited (Schlumberger N.V.) (incorporated by reference to Exhibit 3 to Schlumberger’s Current Report on Form 8-K filed on July 22, 2019)

 

Exhibit 4.1—Indenture dated as of December 3, 2013, by and among Schlumberger Investment SA, as issuer, Schlumberger Limited, as guarantor, and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Schlumberger’s Current Report on Form 8-K filed on December 3, 2013)

 

Exhibit 4.2—Second Supplemental Indenture dated as of June 26, 2020, by and among Schlumberger Investment SA, as issuer, Schlumberger Limited, as guarantor, and The Bank of New York Mellon, as trustee (including form of global notes representing 2.650% Senior Notes due 2030) (incorporated by reference to Exhibit 4.1 to Schlumberger’s Current Report on Form 8-K filed on June 26, 2020)

 

Exhibit 4.3—Officers’ Certificate dated as of August 11, 2020, executed by Schlumberger Investment SA, as issuer, and Schlumberger Limited, as guarantor (including form of global notes representing 2.650% Senior Notes due 2030) (incorporated by reference to Exhibit 4.1 to Schlumberger’s Current Report on Form 8-K filed on August 11, 2020)

 

Exhibit 4.4—Indenture dated as of September 18, 2020, by and among Schlumberger Finance Canada Ltd., as issuer, Schlumberger Limited, as guarantor, and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Schlumberger’s Current Report on Form 8-K filed on September 18, 2020)

 

Exhibit 4.5—First Supplemental Indenture dated as of September 18, 2020, by and among Schlumberger Finance Canada Ltd., as issuer, Schlumberger Limited, as guarantor, and The Bank of New York Mellon, as trustee (including form of global notes representing 1.400% Senior Notes due 2025) (incorporated by reference to Exhibit 4.2 to Schlumberger’s Current Report on Form 8-K filed on September 18, 2020)

 

* Exhibit 22—Issuers of Registered Guaranteed Debt Securities

 

* Exhibit 31.1—Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

* Exhibit 31.2—Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

** Exhibit 32.1—Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

** Exhibit 32.2—Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

* Exhibit 95—Mine Safety Disclosures

 

* Exhibit 101.INS—Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document

 

* Exhibit 101.SCH—Inline XBRL Taxonomy Extension Schema Document

 

* Exhibit 101.CAL—Inline XBRL Taxonomy Extension Calculation Linkbase Document

 

* Exhibit 101.DEF—Inline XBRL Taxonomy Extension Definition Linkbase Document

 

* Exhibit 101.LAB—Inline XBRL Taxonomy Extension Label Linkbase Document

 

* Exhibit 101.PRE—Inline XBRL Taxonomy Extension Presentation Linkbase Document

 

Exhibit 104—Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

*

Filed with this Form 10-Q.

**

Furnished with this Form 10-Q.

The Exhibits filed herewith do not include certain instruments with respect to long-term debt of Schlumberger Limited and its subsidiaries, inasmuch as the total amount of debt authorized under any such instrument does not exceed 10 percent of the total assets of Schlumberger Limited and its subsidiaries on a consolidated basis. Schlumberger agrees, pursuant to Item 601(b)(4)(iii) of Regulation S-K, that it will furnish a copy of any such instrument to the SEC upon request.

 

35


 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized and in his capacity as Chief Accounting Officer.

 

 

 

 

Schlumberger Limited

(Registrant)

Date:

October 21, 2020

 

/s/ Howard Guild

 

 

 

Howard Guild

 

 

 

Chief Accounting Officer and Duly Authorized Signatory

 

 

36

slb-ex22_9.htm

 

Exhibit 22

 

Issuers of Registered Guaranteed Debt Securities

 

Schlumberger Investment SA, a société anonyme incorporated under the laws of the Grand Duchy of Luxembourg (“SISA”), and Schlumberger Finance Canada Ltd., a corporation incorporated under the laws of the Province of Alberta, Canada (“SFCL”), are both indirect wholly-owned subsidiaries of Schlumberger Limited (the “Guarantor”).  

 

As of September 30, 2020, (i) SISA was the issuer of its 3.650% Senior Notes due 2023 and 2.650% Senior Notes due 2030 (together, the “SISA Notes”), and (ii) SFCL was the issuer of its 1.400% Senior Notes due 2025 (the “SFCL Notes”).  The Guarantor fully and unconditionally guarantees the SISA Notes and the SFCL Notes on a senior unsecured basis.

 

 

 

slb-ex311_6.htm

 

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Olivier Le Peuch, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Schlumberger N.V. (Schlumberger Limited);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: October 21, 2020

/s/ Olivier Le Peuch

 

Olivier Le Peuch

 

Chief Executive Officer

 

 

 

 

slb-ex312_8.htm

 

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Stephane Biguet, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Schlumberger N.V. (Schlumberger Limited);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: October 21, 2020

/s/ Stephane Biguet

 

Stephane Biguet

 

Executive Vice President and Chief Financial Officer

 

 

 

 

slb-ex321_7.htm

 

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Schlumberger N.V. (Schlumberger Limited) (the “Company”) for the quarterly period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Olivier Le Peuch, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

 

Date: October 21, 2020

/s/ Olivier Le Peuch

 

Olivier Le Peuch

 

Chief Executive Officer

 

A signed original of this written statement required by Section 906 has been provided to Schlumberger Limited and will be retained by Schlumberger Limited and furnished to the Securities and Exchange Commission or its staff upon request.

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Exchange Act.

 

 

 

slb-ex322_11.htm

 

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Schlumberger N.V. (Schlumberger Limited) (the “Company”) for the quarterly period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Stephane Biguet, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

 

Date: October 21, 2020

/s/ Stephane Biguet

 

Stephane Biguet

 

Executive Vice President and Chief Financial Officer

 

A signed original of this written statement required by Section 906 has been provided to Schlumberger Limited and will be retained by Schlumberger Limited and furnished to the Securities and Exchange Commission or its staff upon request.

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Exchange Act.

 

 

 

slb-ex95_10.htm

 

Exhibit 95

Mine Safety Disclosure

 

The following disclosure is provided pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which requires certain disclosures by companies required to file periodic reports under the Securities Exchange Act of 1934, as amended, that operate mines regulated under the Federal Mine Safety and Health Act of 1977.  

The table that follows reflects citations, orders, violations and proposed assessments issued by the Mine Safety and Health Administration (the “MSHA”) to indirect subsidiaries of Schlumberger.  The disclosure is with respect to the three months ended September 30, 2020.  Due to timing and other factors, the data may not agree with the mine data retrieval system maintained by the MSHA at www.MSHA.gov.

Three Months Ended September 30, 2020

[unaudited]

(whole dollars)

 

Mine or Operating Name/MSHA

Identification Number

Section 104

S&S Citations

Section

104(b)

Orders

Section

104(d)

Citations

and Orders

Section

110(b)(2)

Violations

Section

107(a)

Orders

Total Dollar

Value of MSHA

Assessments

Proposed (1)

Total

Number

of Mining

Related

Fatalities

Received

Notice of

Pattern of

Violations

Under

Section

104(e)

(yes/no)

Received

Notice of

Potential to

Have

Pattern

Under

Section

104(e)

(yes/no)

Legal

Actions

Pending as

of Last Day

of Period

Legal Actions

Initiated

During Period

Legal Actions

Resolved

During

Period

 

 

 

 

 

 

 

 

 

 

 

 

 

Amelia Barite Plant/1600825

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Battle Mountain Grinding Plant/2600828

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Galveston GBT Barite Grinding Plant/4104675

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Greybull Milling Operation/4800602

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Greybull Mining Operation/4800603

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Greystone Mine/2600411

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Mountain Springs Beneficiation Plant/2601390

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Wisconsin Proppants Hixton Mine/4703742

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Wisconsin Proppants Alma Mine/4703823

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Wisconsin Proppants Monahans Mine/4105336

$895

N

N

 

 

 

 

 

 

 

 

 

 

 

 

 

Wisconsin Proppants High Roller Sand Mine/4105321

N

N

 

 

 

(1)

Amounts included are the total dollar value of proposed assessments received from MSHA during the quarter on or before September 30, 2020, regardless of whether the assessment has been challenged or appealed.  Citations and orders can be contested and appealed, and as part of that process, are sometimes reduced in severity and amount, and sometimes dismissed.  The number of citations, orders, and proposed assessments vary by inspector and vary depending on the size and type of the operation.

 

 

 

v3.20.2
Document and Entity Information
9 Months Ended
Sep. 30, 2020
shares
Cover [Abstract]  
Document Type 10-Q
Amendment Flag false
Document Period End Date Sep. 30, 2020
Document Fiscal Year Focus 2020
Document Fiscal Period Focus Q3
Entity Registrant Name SCHLUMBERGER LIMITED/NV
Entity Central Index Key 0000087347
Entity Current Reporting Status Yes
Entity Interactive Data Current Yes
Current Fiscal Year End Date --12-31
Entity Filer Category Large Accelerated Filer
Entity Common Stock, Shares Outstanding 1,392,030,009
Entity Shell Company false
Entity Small Business false
Entity Emerging Growth Company false
Entity File Number 1-4601
Entity Tax Identification Number 52-0684746
Entity Address, Address Line One 5599 SAN FELIPE
Entity Address, City or Town HOUSTON
Entity Address, State or Province TX
Entity Incorporation, State or Country Code P8
Entity Address, Country US
Entity Address, Postal Zip Code 77056
City Area Code 713
Local Phone Number 513-2000
Document Quarterly Report true
Document Transition Report false
Title of 12(b) Security common stock, par value $0.01 per share
Security Exchange Name NYSE
Trading Symbol SLB
v3.20.2
CONSOLIDATED STATEMENT OF LOSS (Unaudited) - USD ($)
shares in Millions, $ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Revenue        
Total Revenue $ 5,258 $ 8,541 $ 18,069 $ 24,689
Interest & other income 22 21 94 61
Expenses        
Research & engineering 137 176 452 527
General & administrative 85 120 293 345
Impairments & other 350 12,692 12,596 12,692
Interest 138 160 419 462
Loss before taxes (54) (11,971) (11,769) (10,870)
Tax expense (benefit) 19 (598) (901) (420)
Net loss (73) (11,373) (10,868) (10,450)
Net income attributable to noncontrolling interests 9 10 24 20
Net loss attributable to Schlumberger $ (82) $ (11,383) $ (10,892) $ (10,470)
Basic loss per share of Schlumberger $ (0.06) $ (8.22) $ (7.84) $ (7.56)
Diluted loss per share of Schlumberger $ (0.06) $ (8.22) $ (7.84) $ (7.56)
Average shares outstanding:        
Basic 1,391 1,385 1,389 1,385
Assuming dilution 1,391 1,385 1,389 1,385
Services        
Revenue        
Total Revenue $ 3,666 $ 6,332 $ 12,812 $ 18,390
Expenses        
Cost of services and sales 3,127 5,371 11,236 15,794
Product        
Revenue        
Total Revenue 1,592 2,209 5,257 6,299
Expenses        
Cost of services and sales $ 1,497 $ 2,014 $ 4,936 $ 5,800
v3.20.2
CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS (Unaudited) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Statement Of Income And Comprehensive Income [Abstract]        
Net loss $ (73) $ (11,373) $ (10,868) $ (10,450)
Currency translation adjustments        
Unrealized net change arising during the period (94) (21) (200) 18
Cash flow hedges        
Net gain (loss) on cash flow hedges 36 (27) (195) (31)
Reclassification to net income of net realized loss 7 3 12 7
Pension and other postretirement benefit plans        
Amortization to net loss of net actuarial loss 48 23 150 70
Amortization to net loss of net prior service credit (2) (2) (13) (8)
Impact of curtailment     (69)  
Income taxes on pension and other postretirement benefit plans   (1) 10 (3)
Comprehensive loss (78) (11,398) (11,173) (10,397)
Comprehensive income attributable to noncontrolling interests 9 10 24 20
Comprehensive loss attributable to Schlumberger $ (87) $ (11,408) $ (11,197) $ (10,417)
v3.20.2
CONSOLIDATED BALANCE SHEET - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Current Assets    
Cash $ 1,219 $ 1,137
Short-term investments 2,618 1,030
Receivables less allowance for doubtful accounts (2020 - $299; 2019 - $255) 5,552 7,747
Inventories 3,542 4,130
Other current assets 1,284 1,486
Current assets total 14,215 15,530
Investments in Affiliated Companies 1,436 1,565
Fixed Assets less accumulated depreciation 7,396 9,270
Multiclient Seismic Data 344 568
Goodwill 12,968 16,042
Intangible Assets 3,573 7,089
Deferred Taxes 33  
Other Assets 4,101 6,248
Total Assets 44,066 56,312
Current Liabilities    
Accounts payable and accrued liabilities 9,201 10,663
Estimated liability for taxes on income 974 1,209
Short-term borrowings and current portion of long-term debt 1,292 524
Dividends payable 184 702
Current Liabilities Total 11,651 13,098
Long-term Debt 16,471 14,770
Postretirement Benefits 854 967
Deferred Taxes   491
Other Liabilities 2,721 2,810
Total Liabilities 31,697 32,136
Equity    
Common stock 12,921 13,078
Treasury stock (3,055) (3,631)
Retained earnings 6,818 18,751
Accumulated other comprehensive loss (4,743) (4,438)
Schlumberger stockholders’ equity 11,941 23,760
Noncontrolling interests 428 416
Total equity 12,369 24,176
Liabilities and stockholders equity $ 44,066 $ 56,312
v3.20.2
CONSOLIDATED BALANCE SHEET (Parenthetical) - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Statement Of Financial Position [Abstract]    
Allowance for doubtful accounts on receivable $ 299 $ 255
v3.20.2
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($)
$ in Millions
9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Cash flows from operating activities:    
Net loss $ (10,868) $ (10,450)
Adjustments to reconcile net loss to cash provided by operating activities:    
Impairments and other charges 12,596 12,692
Depreciation and amortization [1] 1,983 2,741
Deferred taxes (1,147) (833)
Stock-based compensation expense 318 329
Earnings of equity method investments, less dividends received (18) 2
Change in assets and liabilities:    
Decrease (increase) in receivables [2] 2,159 (429)
Increase in inventories [2] (24) (400)
Decrease (increase) in other current assets [2] 202 (127)
Decrease (increase) in other assets 25 (12)
Decrease in accounts payable and accrued liabilities [2] (2,898) (266)
Decrease in estimated liability for taxes on income (261) (118)
Decrease in other liabilities [2] (14) (19)
Other [2] 13 69
NET CASH PROVIDED BY OPERATING ACTIVITIES 2,066 3,179
Cash flows from investing activities:    
Capital expenditures (858) (1,230)
APS investments (252) (526)
Multiclient seismic data costs capitalized (86) (181)
Business acquisitions and investments, net of cash acquired (33) (21)
(Purchase) sale of investments, net (1,597) 238
Net proceeds from divestitures 325  
Other (98) (88)
NET CASH USED IN INVESTING ACTIVITIES (2,599) (1,808)
Cash flows from financing activities:    
Dividends paid (1,560) (2,077)
Proceeds from employee stock purchase plan 146 196
Proceeds from exercise of stock options   23
Stock repurchase program (26) (278)
Proceeds from issuance of long-term debt 5,837 3,973
Repayment of long-term debt (3,811) (3,396)
Net increase (decrease) in short-term borrowings 96 (44)
Other (51) (18)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 631 (1,621)
Net increase in cash before translation effect 98 (250)
Translation effect on cash (16)  
Cash, beginning of period 1,137 1,433
Cash, end of period $ 1,219 $ 1,183
[1] Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.
[2] Net of the effect of business acquisitions and divestitures.
v3.20.2
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($)
shares in Millions, $ in Millions
Total
Common Stock Issued
Common Stock In Treasury
Retained Earnings
Accumulated Other Comprehensive Loss
Noncontrolling Interests
Balance at Dec. 31, 2018 $ 36,586 $ 13,132 $ (4,006) $ 31,658 $ (4,622) $ 424
Net loss (10,450)     (10,470)   20
Currency translation adjustments 14       18 (4)
Changes in fair value of cash flow hedges (24)       (24)  
Pension and other postretirement benefit plans 59       59  
Shares sold to optionees, less shares exchanged 23 (26) 49      
Vesting of restricted stock   (146) 146      
Shares issued under employee stock purchase plan 196 (249) 445      
Stock repurchase program (278)   (278)      
Stock-based compensation expense 329 329        
Dividends declared (2,077)     (2,077)    
Other (51) (28) 3     (26)
Balance at Sep. 30, 2019 24,327 13,012 (3,641) 19,111 (4,569) 414
Balance at Jun. 30, 2019 36,273 13,037 (3,827) 31,186 (4,544) 421
Net loss (11,373)     (11,383)   10
Currency translation adjustments (25)       (21) (4)
Changes in fair value of cash flow hedges (24)       (24)  
Pension and other postretirement benefit plans 20       20  
Shares sold to optionees, less shares exchanged   (20) 20      
Vesting of restricted stock 111 (134) 245      
Stock repurchase program (79)   (79)      
Stock-based compensation expense 135 135        
Dividends declared (692)     (692)    
Other (19) (6)       (13)
Balance at Sep. 30, 2019 24,327 13,012 (3,641) 19,111 (4,569) 414
Balance at Dec. 31, 2019 $ 24,176 $ 13,078 $ (3,631) 18,751 (4,438) 416
Balance, shares at Dec. 31, 2019 1,385 1,434        
Treasury shares, Balance at Dec. 31, 2019     (49)      
Net loss $ (10,868)     (10,892)   24
Currency translation adjustments (198)       (200) 2
Changes in fair value of cash flow hedges (183)       (183)  
Pension and other postretirement benefit plans $ 78       78  
Vesting of restricted stock   $ (152) $ 152      
Vesting of restricted stock, shares 2   2      
Shares issued under employee stock purchase plan $ 146 (298) $ 444      
Shares issued under employee stock purchase plan, shares 6   6      
Stock repurchase program $ (26)   $ (26)      
Stock repurchase program, shares (1)   (1)      
Stock-based compensation expense $ 318 318        
Dividends declared (1,041)     (1,041)    
Other (33) (25) $ 6     (14)
Balance at Sep. 30, 2020 $ 12,369 $ 12,921 $ (3,055) 6,818 (4,743) 428
Balance, shares at Sep. 30, 2020 1,392 1,434        
Treasury shares, Balance at Sep. 30, 2020     (42)      
Balance at Jun. 30, 2020 $ 12,456 $ 13,044 $ (3,339) 7,073 (4,738) 416
Net loss (73)     (82)   9
Currency translation adjustments (90)       (94) 4
Changes in fair value of cash flow hedges 43       43  
Pension and other postretirement benefit plans 46       46  
Vesting of restricted stock   (21) 21      
Shares issued under employee stock purchase plan 61 (203) 264      
Stock-based compensation expense 105 105        
Dividends declared (173)     (173)    
Other (6) (4) (1)     (1)
Balance at Sep. 30, 2020 $ 12,369 $ 12,921 $ (3,055) $ 6,818 $ (4,743) $ 428
Balance, shares at Sep. 30, 2020 1,392 1,434        
Treasury shares, Balance at Sep. 30, 2020     (42)      
v3.20.2
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Parenthetical) (Unaudited) - $ / shares
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Retained Earnings        
Dividends declared, per share $ 0.125 $ 0.50 $ 0.75 $ 1.50
v3.20.2
Basis of Presentation
9 Months Ended
Sep. 30, 2020
Organization Consolidation And Presentation Of Financial Statements [Abstract]  
Basis of Presentation

1.   Basis of Presentation

The accompanying unaudited consolidated financial statements of Schlumberger Limited and its subsidiaries (“Schlumberger”) have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of Schlumberger management, all adjustments considered necessary for a fair statement have been included in the accompanying unaudited financial statements.  All intercompany transactions and balances have been eliminated in consolidation.  Operating results for the nine-month period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020.  The December 31, 2019 balance sheet information has been derived from the Schlumberger 2019 audited financial statements.  For further information, refer to the Consolidated Financial Statements and notes thereto included in the Schlumberger Annual Report on Form 10-K for the year ended December 31, 2019, filed with the Securities and Exchange Commission on January 22, 2020.

On August 31, 2020, Schlumberger and Liberty Oilfield Services Inc. (“Liberty”) entered into an agreement for the contribution to Liberty of OneStim®, Schlumberger’s onshore hydraulic fracturing business in the United States and Canada, including its pressure pumping, pumpdown perforating, and Permian frac sand businesses, in exchange for a 37% equity interest in Liberty.  The transaction is expected to close in the fourth quarter of 2020 and is subject to Liberty stockholder approval and other customary closing conditions.  OneStim represented approximately 5% of Schlumberger’s consolidated revenue for the nine months ended September 30, 2020.

v3.20.2
Charges and Credits
9 Months Ended
Sep. 30, 2020
Restructuring And Related Activities [Abstract]  
Charges and Credits

2.   Charges and Credits

Schlumberger recorded the following charges and credits during 2020, all of which are classified in Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

First quarter:

 

 

 

 

 

 

 

 

 

 

 

Goodwill

$

3,070

 

 

$

-

 

 

$

3,070

 

Intangible asset impairments

 

3,321

 

 

 

(815

)

 

 

2,506

 

Asset Performance Solutions investments

 

1,264

 

 

 

4

 

 

 

1,268

 

North America pressure pumping impairment

 

587

 

 

 

(133

)

 

 

454

 

Workforce reductions

 

202

 

 

 

(7

)

 

 

195

 

Other

 

79

 

 

 

(9

)

 

 

70

 

Valuation allowance

 

-

 

 

 

164

 

 

 

164

 

Second quarter:

 

 

 

 

 

 

 

 

 

 

 

Workforce reductions

 

1,021

 

 

 

(71

)

 

 

950

 

Asset Performance Solutions investments

 

730

 

 

 

(15

)

 

 

715

 

Fixed asset impairments

 

666

 

 

 

(52

)

 

 

614

 

Inventory write-downs

 

603

 

 

 

(49

)

 

 

554

 

Right-of-use asset impairments

 

311

 

 

 

(67

)

 

 

244

 

Costs associated with exiting certain activities

 

205

 

 

 

25

 

 

 

230

 

Multiclient seismic data impairment

 

156

 

 

 

(2

)

 

 

154

 

Repurchase of bonds

 

40

 

 

 

(2

)

 

 

38

 

Postretirement benefits curtailment gain

 

(69

)

 

 

16

 

 

 

(53

)

Other

 

60

 

 

 

(4

)

 

 

56

 

Third quarter:

 

 

 

 

 

 

 

 

 

 

 

Facility exit charges

 

254

 

 

 

(39

)

 

 

215

 

Workforce reductions

 

63

 

 

 

-

 

 

 

63

 

Other

 

33

 

 

 

(1

)

 

 

32

 

 

$

12,596

 

 

$

(1,057

)

 

$

11,539

 

 

First quarter 2020:

 

 

Geopolitical events that increased the supply of low-priced oil to the global market occurred at the same time that demand weakened due to the worldwide effects of the COVID-19 pandemic, leading to a collapse in oil prices during March 2020.  As a result, Schlumberger’s market capitalization deteriorated significantly compared to the end of 2019.  Schlumberger’s stock price reached a low during the first quarter of 2020 not seen since 1995.  Additionally, the Philadelphia Oil Services Sector index, which is comprised of companies involved in the oil services sector, reached an all-time low.  As a result of these facts, Schlumberger determined that it was more likely than not that the fair value of certain of its reporting units were less than their carrying value.  Therefore, Schlumberger performed an interim goodwill impairment test.

Schlumberger had 11 reporting units with goodwill balances aggregating $16.0 billion.  Schlumberger determined that the fair value of four of its reporting units, representing $4.5 billion of the goodwill, was substantially in excess of their carrying value.  Schlumberger performed a detailed quantitative impairment assessment of the remaining seven reporting units, which represented $11.5 billion of goodwill. As a result of this assessment, Schlumberger concluded that the goodwill associated with each of these seven reporting units was impaired, resulting in a $3.1 billion goodwill impairment charge.  This charge primarily relates to goodwill associated with the Drilling and Production segments.

 

Following the $3.1 billion goodwill impairment charge relating to these seven reporting units, six of these reporting units had a remaining goodwill balance.  These six reporting units had goodwill balances which ranged between $0.2 billion and $5.0 billion and aggregated to $8.4 billion as of March 31, 2020.

 

Schlumberger used the income approach to estimate the fair value of its reporting units, but also considered the market approach to validate the results.  The income approach estimates the fair value by discounting each reporting unit’s estimated future cash flows using Schlumberger’s estimate of the discount rate, or expected return, that a marketplace participant would have required as of the valuation date.  The market approach includes the use of comparative multiples to corroborate the discounted cash flow results. The market approach involves significant judgement involved in the selection of the appropriate peer group companies and valuation multiples.

 

Some of the more significant assumptions inherent in the income approach include the estimated future net annual cash flows for each reporting unit and the discount rate.  Schlumberger selected the assumptions used in the discounted cash flow projections using historical data supplemented by current and anticipated market conditions and estimated growth rates.  Schlumberger’s estimates are based upon assumptions believed to be reasonable.  However, given the inherent uncertainty in determining the assumptions underlying a discounted cash flow analysis, particularly in the current volatile market, actual results may differ from those used in Schlumberger’s valuations which could result in additional impairment charges in the future.

 

The discount rates utilized to value Schlumberger’s reporting units were between 12.0% and 13.5%, depending on the risks and uncertainty inherent in the respective reporting unit as well as the size of the reporting unit.  Assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50-basis point increase or decrease in the discount rate assumptions would have changed the fair value of the seven reporting units, on average, by less than 5%.

 

 

The negative market indicators described above were triggering events that indicated that certain of Schlumberger’s long-lived intangible and tangible assets may have been impaired.  Recoverability testing indicated that certain long-lived assets were impaired.  The estimated fair value of these assets was determined to be below their carrying value.  As a result, Schlumberger recorded the following impairment charges:

 

-

$3.3 billion relating to intangible assets, of which $2.2 billion relates to Schlumberger’s 2016 acquisition of Cameron International Corporation and $1.1 billion relates to Schlumberger’s 2010 acquisition of Smith International, Inc.  Following this impairment charge, the carrying value of the impaired intangible assets was approximately $0.9 billion.

 

-

$1.3 billion relating to the carrying value of certain Asset Performance Solutions (“APS”) projects in North America.

 

-

$0.6 billion of fixed assets associated with the pressure pumping business in North America.  

 

 

$202 million of severance.

 

 

$79 million of other restructuring charges, primarily consisting of the impairment of an equity method investment that was determined to be other-than-temporarily impaired.

 

 

$164 million relating to a valuation allowance against certain deferred tax assets.

 

Second quarter 2020:

 

 

As previously noted, late in the first quarter of 2020 geopolitical events that increased the supply of low-priced oil to the global market occurred at the same time as demand weakened due to the worldwide effects of the COVID-19 pandemic, which led to a collapse in oil prices.  As a result, the second quarter of 2020 was the most challenging quarter in decades.  Schlumberger responded to these market conditions by taking actions to restructure its business and rationalize its asset base during the second quarter of 2020.  These actions included reducing headcount, closing facilities and exiting business lines in certain countries.  Additionally, due to the resulting activity decline, Schlumberger had assets that would no longer be utilized.  As a consequence of these circumstances and decisions, Schlumberger recorded the following restructuring and asset impairment charges:

 

-

$1.021 billion of severance associated with reducing its workforce by more than 21,000 employees.  

 

-

$730 million relating to the carrying value of certain APS projects in Latin America.

 

-

$666 million of fixed asset impairments primarily relating to equipment that would no longer be utilized and facilities it exited.

 

-

$603 million write-down of the carrying value of inventory to its net realizable value.

 

-

$311 million write-down of right-of-use assets under operating leases associated with leased facilities Schlumberger exited and excess equipment.

 

-

$205 million of costs associated with exiting certain activities.

 

-

$156 million impairment of certain multiclient seismic data.

 

-

$60 million of other costs, including a $42 million increase in the allowance for the doubtful accounts.

 

 

During the second quarter of 2020, Schlumberger repurchased certain Senior Notes (see Note 9 – Long-term Debt), which resulted in a $40 million charge.

 

 

As a consequence of the workforce reductions described above, Schlumberger recorded a curtailment gain of $69 million relating to its US postretirement medical plan.  See Note 13 – Pension and Other Postretirement Benefit Plans for further details.

The fair value of the impaired intangible assets, fixed assets, APS investments, right-of-use assets and multiclient seismic data was estimated based on the present value of projected future cash flows that the underlying assets are expected to generate.  Such estimates included unobservable inputs that required significant judgement.

 

Third quarter 2020:

 

 

During the third quarter of 2020 Schlumberger recorded the following restructuring charges:

 

-

$254 million of facility exit charges as Schlumberger continued to rationalize its real estate footprint relating to both leased and owned facilities.

 

-

$63 million of severance.

 

-

$33 million of other charges.

As market conditions evolve and Schlumberger continues to develop its strategy to deal with such conditions, it may result in further restructuring and/or impairment charges in future periods.

2019

In connection with the preparation of its third quarter 2019 financial statements, Schlumberger recorded the following charges, all of which are classified as Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

Goodwill

$

8,828

 

 

$

(43

)

 

$

8,785

 

Intangible assets

 

1,085

 

 

 

(248

)

 

 

837

 

North America pressure pumping

 

1,575

 

 

 

(344

)

 

 

1,231

 

Other North America-related

 

310

 

 

 

(53

)

 

 

257

 

Argentina

 

127

 

 

 

-

 

 

 

127

 

Equity-method investments

 

231

 

 

 

(12

)

 

 

219

 

Asset Performance Solutions investments

 

294

 

 

 

-

 

 

 

294

 

Other

 

242

 

 

 

(13

)

 

 

229

 

 

$

12,692

 

 

$

(713

)

 

$

11,979

 

 

 

During August 2019, Schlumberger’s market capitalization deteriorated significantly compared to the end of the second quarter of 2019.  Schlumberger’s stock price reached a low not seen since 2005.  Additionally, the Philadelphia Oil Services Sector Index, which is comprised of companies involved in the oil services sector, reached an 18-year low.

As a result of these facts, Schlumberger determined that it was more likely than not that the fair value of certain of its reporting units were less than their carrying value.  Therefore, Schlumberger performed an interim goodwill impairment test as of August 31, 2019.

As of August 31, 2019, Schlumberger had 17 reporting units with goodwill balances aggregating $25.0 billion.  Schlumberger determined that the fair value of seven of its reporting units, representing approximately $13.8 billion of the goodwill, was substantially in excess of their carrying value.  Schlumberger performed a detailed quantitative impairment assessment of the remaining 10 reporting units, which represented $11.2 billion of goodwill. As a result of this assessment, Schlumberger concluded that the goodwill associated with nine of the 10 reporting units was impaired, resulting in an $8.8 billion goodwill impairment charge.  This charge primarily relates to Schlumberger’s Drilling and Cameron segments.

Following the $8.8 billion goodwill impairment charge relating to these nine reporting units, only three had a remaining goodwill balance.  These three reporting units had goodwill balances which ranged between $0.4 billion and $0.6 billion and aggregated to $1.5 billion as of August 31, 2019. The tenth reporting unit, which was determined not to be impaired, had $0.9 billion of goodwill.

Schlumberger primarily used the income approach to estimate the fair value of its reporting units, but also considered the market approach to validate the results.  The income approach estimates the fair value by discounting each reporting unit’s estimated future cash flows using Schlumberger’s estimate of the discount rate, or expected return, that a marketplace participant would have required as of the valuation date.  The market approach includes the use of comparative multiples to corroborate the discounted cash flow results.  The market approach involves significant judgement involved in the selection of the appropriate peer group companies and valuation multiples.

Some of the more significant assumptions inherent in the income approach include the estimated future net annual cash flows for each reporting unit and the discount rate.  Schlumberger selected the assumptions used in the discounted cash flow projections using historical data supplemented by current and anticipated market conditions and estimated growth rates.  Schlumberger’s estimates are based upon assumptions believed to be reasonable.  However, given the inherent uncertainty in determining the assumptions underlying a discounted cash flow analysis, actual results may differ from those used in Schlumberger’s valuations which could result in additional impairment charges in the future.

The discount rates utilized to value Schlumberger’s reporting units were between 12.5% and 14.0%, depending on the risks and uncertainty inherent in the respective reporting unit.  Assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50 basis point increase in the discount rate assumption would have increased the goodwill impairment charge by approximately $0.3 billion.  Conversely, assuming all other assumptions and inputs used in each of the respective discounted cash flow analysis were held constant, a 50 basis point decrease in the discount rate assumption would have decreased the goodwill impairment charge by approximately $0.4 billion.

 

The negative market indicators described above, combined with deteriorating market conditions in North America, as well as the results of the previously mentioned fair value determinations of certain of Schlumberger’s reporting units and the appointment of a new Chief Executive Officer (as described below), were all triggering events that indicated that certain of Schlumberger’s long-lived tangible and intangible assets may have been impaired.

Recoverability testing, which was performed as of August 31, 2019, indicated that long-lived assets associated with certain asset groups were impaired.  The estimated fair value of these asset groups was determined to be below their carrying value.  As a result, Schlumberger recorded the following impairment and related charges:

 

-

$1.085 billion of intangible assets, of which $842 million related to Schlumberger’s 2010 acquisition of Smith International, Inc.  The remaining $243 million primarily related to other acquisitions in North America.

 

-

$1.575 billion of charges relating to Schlumberger’s pressure pumping business in North America.  This amount consisted of $1.324 billion of pressure pumping equipment and related assets; $98 million of right-of-use assets under operating leases; $121 million relating to a supply contract; $19 million of inventory; and $13 million of severance.

 

-

$310 million of charges primarily relating to other businesses in North America, consisting of $230 million of fixed asset impairments, $70 million of inventory write-downs and $10 million of severance.

 

 

As a result of the ongoing economic challenges in Argentina, Schlumberger recorded $127 million of charges during the third quarter of 2019.  This consisted of $72 million of asset impairments, a $26 million devaluation charge and $29 million of severance.

 

 

Schlumberger also recorded the following impairment and restructuring charges:

 

-

$231 million relating to certain equity method investments that were determined to be other-than-temporarily impaired.

 

-

$294 million impairment relating to the carrying value of certain smaller APS projects.

 

-

$242 million of restructuring charges consisting of: $62 million of severance; $57 million relating to the acceleration of stock-based compensation expense associated with certain individuals; $49 million of business divestiture costs; $29 million relating to the repurchase of certain Senior Notes (see Note 9 - Long-term Debt); and $45 million of other provisions.

The fair value of certain of these impaired assets was estimated based on the present value of projected future cash flows that the underlying assets were expected to generate.  Such estimates included unobservable inputs that required significant judgment.

There were no charges or credits recorded during the first six months of 2019.

v3.20.2
Loss Per Share
9 Months Ended
Sep. 30, 2020
Earnings Per Share [Abstract]  
Loss Per Share

3.   Loss Per Share

The following is a reconciliation from basic loss per share of Schlumberger to diluted loss per share of Schlumberger:

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Third Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Nine Months

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

 

The number of outstanding options to purchase shares of Schlumberger common stock that were not included in the computation of diluted loss per share, because to do so would have had an antidilutive effect, was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

2019

 

 

2020

 

2019

 

Employee stock options

49

 

47

 

 

49

 

 

40

 

Unvested restricted stock

18

 

 

-

 

 

18

 

 

-

 

 

v3.20.2
Inventories
9 Months Ended
Sep. 30, 2020
Inventory Disclosure [Abstract]  
Inventories

4.   Inventories

A summary of inventories, which are stated at the lower of average cost or net realizable value, is as follows:  

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Raw materials & field materials

$

1,609

 

 

$

1,857

 

Work in progress

 

520

 

 

 

515

 

Finished goods

 

1,413

 

 

 

1,758

 

 

$

3,542

 

 

$

4,130

 

 

v3.20.2
Fixed Assets
9 Months Ended
Sep. 30, 2020
Property Plant And Equipment [Abstract]  
Fixed Assets

5.   Fixed Assets

A summary of fixed assets follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Property, plant & equipment

$

32,128

 

 

$

35,009

 

Less: Accumulated depreciation

 

24,732

 

 

 

25,739

 

 

$

7,396

 

 

$

9,270

 

 

Depreciation expense relating to fixed assets was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

385

 

 

$

499

 

Nine Months

$

1,251

 

 

$

1,525

 

 

 

v3.20.2
Multiclient Seismic Data
9 Months Ended
Sep. 30, 2020
Multiclient Seismic Data [Abstract]  
Multiclient Seismic Data

6.   Multiclient Seismic Data

The change in the carrying amount of multiclient seismic data for the nine months ended September 30, 2020 was as follows:

 

(Stated in millions)

 

 

 

 

 

Balance at December 31, 2019

$

568

 

Capitalized in period

 

86

 

Charged to expense

 

(132

)

Impairments (See Note 2)

 

(156

)

Other

 

(22

)

 

$

344

 

 

v3.20.2
Goodwill
9 Months Ended
Sep. 30, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill

7.   Goodwill

The changes in the carrying amount of goodwill by segment were as follows:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reservoir

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Characterization

 

 

Drilling

 

 

Production

 

 

Cameron

 

 

Total

 

Balance at December 31, 2019

$

4,560

 

 

$

7,092

 

 

$

3,949

 

 

$

441

 

 

$

16,042

 

Impairment (See Note 2)

 

-

 

 

 

(1,659

)

 

 

(1,228

)

 

 

(183

)

 

 

(3,070

)

Impact of changes in exchange rates and other

 

-

 

 

 

10

 

 

 

(17

)

 

 

3

 

 

 

(4

)

Balance at September 30, 2020

$

4,560

 

 

$

5,443

 

 

$

2,704

 

 

$

261

 

 

$

12,968

 

 

v3.20.2
Intangible Assets
9 Months Ended
Sep. 30, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Intangible Assets

8.   Intangible Assets

The gross book value, accumulated amortization and net book value of intangible assets were as follows:

 

 

(Stated in millions)

 

 

 

 

 

Sept. 30, 2020

 

 

Dec. 31, 2019

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Book Value

 

 

Amortization

 

 

Value

 

 

Book Value

 

 

Amortization

 

 

Value

 

Customer relationships

$

1,744

 

 

$

467

 

 

$

1,277

 

 

$

3,779

 

 

$

868

 

 

$

2,911

 

Technology/technical know-how

 

1,290

 

 

 

467

 

 

 

823

 

 

 

2,498

 

 

 

779

 

 

 

1,719

 

Tradenames

 

767

 

 

 

157

 

 

 

610

 

 

 

1,885

 

 

 

264

 

 

 

1,621

 

Other

 

1,548

 

 

 

685

 

 

 

863

 

 

 

1,514

 

 

 

676

 

 

 

838

 

 

$

5,349

 

 

$

1,776

 

 

$

3,573

 

 

$

9,676

 

 

$

2,587

 

 

$

7,089

 

 

Amortization expense charged to income was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

79

 

 

$

156

 

Nine Months

$

292

 

 

$

480

 

 

Based on the net book value of intangible assets at September 30, 2020, amortization charged to income for the subsequent five years is estimated to be: fourth quarter of 2020—$81 million; 2021—$305 million; 2022—$298 million; 2023—$286 million; 2024—$259 million; and 2025—$252 million.

v3.20.2
Long-term Debt
9 Months Ended
Sep. 30, 2020
Debt Disclosure [Abstract]  
Long-term Debt

9.   Long-term Debt

A summary of Long-term Debt follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

3.65% Senior Notes due 2023

$

1,496

 

 

$

1,495

 

3.90% Senior Notes due 2028

 

1,449

 

 

 

1,444

 

1.375% Guaranteed Notes due 2026

 

1,163

 

 

 

-

 

2.00% Guaranteed Notes due 2032

 

1,163

 

 

 

-

 

0.25% Notes due 2027

 

1,058

 

 

 

550

 

0.50% Notes due 2031

 

1,058

 

 

 

544

 

2.65% Senior Notes due 2030

 

1,250

 

 

 

-

 

2.40% Senior Notes due 2022

 

999

 

 

 

998

 

4.00% Senior Notes due 2025

 

930

 

 

 

929

 

4.30% Senior Notes due 2029

 

845

 

 

 

845

 

3.75% Senior Notes due 2024

 

746

 

 

 

746

 

1.00% Guaranteed Notes due 2026

 

704

 

 

 

665

 

2.65% Senior Notes due 2022

 

598

 

 

 

598

 

0.00% Notes due 2024

 

588

 

 

 

551

 

1.40% Senior Notes due 2025

 

498

 

 

 

-

 

3.63% Senior Notes due 2022

 

295

 

 

 

294

 

7.00% Notes due 2038

 

206

 

 

 

208

 

5.95% Notes due 2041

 

114

 

 

 

114

 

5.13% Notes due 2043

 

99

 

 

 

99

 

4.00% Notes due 2023

 

80

 

 

 

81

 

3.70% Notes due 2024

 

55

 

 

 

55

 

3.30% Senior Notes due 2021

 

-

 

 

 

1,597

 

4.20% Senior Notes due 2021

 

-

 

 

 

600

 

Commercial paper borrowings

 

1,077

 

 

 

2,222

 

Other

 

-

 

 

 

135

 

 

$

16,471

 

 

$

14,770

 

 

The estimated fair value of Schlumberger’s Long-term Debt, based on quoted market prices at September 30, 2020 and December 31, 2019, was $17.2 billion and $15.3 billion, respectively.

During the second quarter of 2020, Schlumberger entered into a €1.54 billion committed revolving credit facility.  This one-year facility can be extended at Schlumberger’s option for up to an additional year.  At September 30, 2020 no amounts had been drawn under this facility.

At September 30, 2020, Schlumberger had separate committed credit facility agreements aggregating $8.06 billion with commercial banks, of which $6.98 billion was available and unused.  These committed facilities support commercial paper programs in the United States and Europe, of which $1.81 billion matures in April 2021, $2.75 billion matures in February 2023, $2.0 billion matures in February 2025 and $1.5 billion matures in July 2025  .  Interest rates and other terms of borrowing under these lines of credit vary by facility.

Borrowings under the commercial paper programs at September 30, 2020 were $1.08 billion, all of which was classified in Long-term debt in the Consolidated Balance Sheet.  At December 31, 2019, borrowings under the commercial paper programs were $2.22 billion, all of which was classified in Long-term debt in the Consolidated Balance Sheet.

During the first quarter of 2020, Schlumberger issued €400 million of 0.25% Notes due 2027 and €400 million of 0.50% Notes due 2031.

During the second quarter of 2020, Schlumberger issued €1.0 billion of 1.375% Guaranteed Notes due 2026, $900 million of 2.65% Senior Notes due 2030 and €1.0 billion of 2.00% Guaranteed Notes due 2032.

 

During the second quarter of 2020, Schlumberger repurchased all $600 million of its 4.20% Senior Notes due 2021 and $935 million of its 3.30% Senior Notes due 2021.  Schlumberger paid a premium of approximately $40 million in connection with these repurchases.  This premium was classified in Impairments & other in the Consolidated Statement of Loss.  See Note 2 – Charges and Credits.

 

During the second quarter of 2020, Schlumberger established a €5.0 billion Guaranteed Euro Medium Term Note program that provides for the issuance of various types of debt instruments such as fixed or floating rate notes in euro, US dollar or other currencies.  At September 30, 2020, Schlumberger had not issued any debt under this program.

During the third quarter of 2020, Schlumberger issued $500 million of 1.40% Senior Notes due 2025 and $350 million of 2.65% Senior Notes due 2030.

             

During the third quarter of 2019, Schlumberger issued €500 million of 0.00% Notes due 2024, €500 million of 0.25% Notes due 2027 and €500 million of 0.50% Notes due 2031.

 

In September 2019, Schlumberger repurchased $783 million of its 3.00% Senior Notes due 2020 and $321 million of its 3.625% Senior Notes due 2022. Schlumberger paid a premium of $29 million in connection with these repurchases. This premium was classified as Impairments & other in the Consolidated Statement of Loss. (See Note 2 - Charges and Credits.)

In April 2019, Schlumberger completed a debt exchange offer, pursuant to which it issued $1.500 billion in principal of 3.90% Senior Notes due 2028 (the “New Notes”) in exchange for $401 million of 3.00% Senior Notes due 2020, $234 million of 3.63% Senior Notes due 2022 and $817 million of 4.00% Senior Notes due 2025.  In connection with the exchange of principal, Schlumberger paid a premium of $48 million, substantially all of which was in the form of New Notes.  This premium is being amortized as additional interest expense over the term of the New Notes.

Schlumberger Limited fully and unconditionally guarantees the securities issued by certain of its subsidiaries, including securities issued by Schlumberger Investment SA and Schlumberger Finance Canada Ltd., both wholly-owned subsidiaries of Schlumberger.

v3.20.2
Derivative Instruments and Hedging Activities
9 Months Ended
Sep. 30, 2020
Derivative Instruments And Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities

10.   Derivative Instruments and Hedging Activities

Schlumberger is exposed to market risks related to fluctuations in foreign currency exchange rates and interest rates.  To mitigate these risks, Schlumberger utilizes derivative instruments.  Schlumberger does not enter into derivative transactions for speculative purposes.

Interest Rate Risk

Schlumberger is subject to interest rate risk on its debt and its investment portfolio.  Schlumberger maintains an interest rate risk management strategy that uses a mix of variable and fixed rate debt combined with its investment portfolio, to mitigate the exposure to changes in interest rates. 

At September 30, 2020, Schlumberger had fixed rate debt aggregating $16.6 billion and variable rate debt aggregating $1.2 billion.

Foreign Currency Exchange Rate Risk

As a multinational company, Schlumberger generates revenue in more than 120 countries. Schlumberger’s functional currency is primarily the US dollar.  However, outside the United States, a significant portion of Schlumberger’s expenses are incurred in foreign currencies.  Therefore, when the US dollar weakens (strengthens) in relation to the foreign currencies of the countries in which Schlumberger conducts business, the US dollar-reported expenses will increase (decrease).  

Schlumberger is exposed to risks on future cash flows to the extent that the local currency is not the functional currency and expenses denominated in local currency are not equal to revenues denominated in local currency.  Schlumberger uses foreign currency forward contracts to provide a hedge against a portion of these cash flow risks.  These contracts are accounted for as cash flow hedges, with the changes in the fair value of the hedge recorded on the Consolidated Balance Sheet and in Accumulated Other Comprehensive Loss.  Amounts recorded in Accumulated Other Comprehensive Loss are reclassified into earnings in the same period or periods that the hedged item is recognized in earnings. 

Schlumberger is also exposed to risks on future cash flows relating to certain of its fixed rate debt denominated in currencies other than the functional currency. Schlumberger uses cross-currency swaps to provide a hedge against these cash flow risks.

During 2017, a Canadian-dollar functional currency subsidiary of Schlumberger issued $1.1 billion of US-dollar denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of $1.1 billion in order to hedge changes in the fair value of its $0.5 billion of 2.20% Senior Notes due 2020 and its $0.6 billion of 2.65% Senior Notes due 2022.  These cross-currency swaps effectively convert the US-dollar denominated notes to Canadian-dollar denominated debt with fixed annual interest rates of 1.97% and 2.52%, respectively.

During 2019, a US-dollar functional currency subsidiary of Schlumberger issued €1.5 billion of Euro-denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of €1.5 billion in order to hedge changes in the fair value of its €0.5 billion 0.00% Notes due 2024, €0.5 billion 0.25% Notes due 2027 and €0.5 billion 0.50% Notes due 2031. These cross-currency swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.29%, 2.51% and 2.76%, respectively.

During the first quarter of 2020, a US-dollar functional currency subsidiary of Schlumberger issued €0.8 billion of Euro-denominated debt. Schlumberger entered into cross-currency swaps for an aggregate notional amount of €0.8 billion in order to hedge changes in the fair value of its €0.4 billion of 0.25% Notes due 2027 and €0.4 billion of 0.50% Notes due 2031. These cross-currency swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 1.87% and 2.20%, respectively.

During the second quarter of 2020, a US-dollar functional currency subsidiary of Schlumberger issued €2.0 billion of Euro-denominated debt. Schlumberger entered into cross-currency swaps for an aggregate notional amount of €1.85 billion in order to hedge changes in the fair value of its €1.0 billion of 1.375% Guaranteed Notes due 2026 and €0.85 billion of 2.00% Guaranteed Notes due 2032. These cross-currency swaps effectively convert the swapped portion of the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.77% and 3.45%, respectively. Schlumberger hedged its exposure to currency fluctuations on the remaining €0.15 billion of Euro-denominated debt issued by using foreign currency forward contracts that are not designated as hedges for accounting purposes.

During the third quarter of 2020, a Canadian dollar functional currency subsidiary of Schlumberger issued $0.5 billion of US dollar denominated debt.  Schlumberger entered into cross-currency swaps for an aggregate notional amount of $0.5 billion in order to hedge changes in the fair value of its $0.5 billion 1.40% Senior Notes due 2025. These cross-currency swaps effectively convert the US dollar notes to Canadian dollar denominated debt with a fixed annual interest rate of 1.73%.

Schlumberger is exposed to changes in the fair value of assets and liabilities that are denominated in currencies other than the functional currency.  While Schlumberger uses foreign currency forward contracts and foreign currency options to economically hedge this exposure as it relates to certain currencies, these contracts are not designated as hedges for accounting purposes.  Instead, the fair value of the contracts is recorded on the Consolidated Balance Sheet, and changes in the fair value are recognized in the Consolidated Statement of Loss as are changes in fair value of the hedged item.  

At September 30, 2020, contracts were outstanding for the US dollar equivalent of $10.9 billion in various foreign currencies, of which $6.7 billion relates to hedges of debt denominated in currencies other than the functional currency.

At September 30, 2020, Schlumberger recognized a cumulative $218 million loss in Accumulated Other Comprehensive Loss relating to changes in the fair value of foreign currency forward contracts and cross-currency swaps.

The effect of derivative instruments designated as cash flow hedges, and those not designated as hedges, on the Consolidated Statement of Loss was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (Loss) Recognized in Loss

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

Consolidated Statement of Loss Classification

Derivatives designated as cash flow hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(7

)

 

$

(3

)

 

$

(12

)

 

$

(7

)

 

Cost of services/sales

Cross currency swaps

 

197

 

 

 

(2

)

 

 

347

 

 

 

(40

)

 

Cost of services/sales

 

$

190

 

 

$

(5

)

 

$

335

 

 

$

(47

)

 

 

Derivatives not designated as hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(14

)

 

$

-

 

 

$

(12

)

 

$

(8

)

 

Cost of services/sales

 

v3.20.2
Contingencies
9 Months Ended
Sep. 30, 2020
Commitments And Contingencies Disclosure [Abstract]  
Contingencies

11.   Contingencies

Schlumberger is party to various legal proceedings from time to time.  A liability is accrued when a loss is both probable and can be reasonably estimated.  Management believes that the probability of a material loss with respect to any currently pending legal proceeding is remote.  However, litigation is inherently uncertain and it is not possible to predict the ultimate disposition of any of these proceedings.  

v3.20.2
Segment Information
9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Information

12.   Segment Information

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

Third Quarter 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

1,010

 

 

$

169

 

 

$

1,651

 

 

$

360

 

Drilling

 

1,519

 

 

 

144

 

 

 

2,469

 

 

 

306

 

Production

 

1,801

 

 

 

227

 

 

 

3,153

 

 

 

288

 

Cameron

 

965

 

 

 

60

 

 

 

1,363

 

 

 

173

 

Eliminations & other

 

(37

)

 

 

(25

)

 

 

(95

)

 

 

(31

)

 

 

 

 

 

 

575

 

 

 

 

 

 

 

1,096

 

Corporate & other (1)

 

 

 

 

 

(151

)

 

 

 

 

 

 

(231

)

Interest income (2)

 

 

 

 

 

3

 

 

 

 

 

 

 

7

 

Interest expense (3)

 

 

 

 

 

(131

)

 

 

 

 

 

 

(151

)

Charges and credits (4)

 

 

 

 

 

(350

)

 

 

 

 

 

 

(12,692

)

 

$

5,258

 

 

$

(54

)

 

$

8,541

 

 

$

(11,971

)

 

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($- million in 2020; $1 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($7 million in 2020; $9 million in 2019).

(4)

See Note 2 – Charges and Credits.

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

Nine Months 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

3,372

 

 

$

538

 

 

$

4,669

 

 

$

959

 

Drilling

 

5,540

 

 

 

594

 

 

 

7,275

 

 

 

914

 

Production

 

6,119

 

 

 

464

 

 

 

9,120

 

 

 

740

 

Cameron

 

3,235

 

 

 

262

 

 

 

3,949

 

 

 

486

 

Eliminations & other

 

(197

)

 

 

(111

)

 

 

(324

)

 

 

(127

)

 

 

 

 

 

 

1,747

 

 

 

 

 

 

 

2,972

 

Corporate & other (1)

 

 

 

 

 

(548

)

 

 

 

 

 

 

(742

)

Interest income (2)

 

 

 

 

 

25

 

 

 

 

 

 

 

25

 

Interest expense (3)

 

 

 

 

 

(397

)

 

 

 

 

 

 

(433

)

Charges and credits (4)

 

 

 

 

 

(12,596

)

 

 

 

 

 

 

(12,692

)

 

$

18,069

 

 

$

(11,769

)

 

$

24,689

 

 

$

(10,870

)

 

Certain prior period amounts have been reclassified to conform to the current period presentation.

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($1 million in 2020; $6 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($22 million in 2020; $29 million in 2019).

(4)

See Note 2 – Charges and Credits.

 

Revenue by geographic area was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

North America

$

1,157

 

 

$

2,850

 

 

$

4,620

 

 

$

8,389

 

Latin America

 

707

 

 

 

1,014

 

 

 

2,195

 

 

 

3,121

 

Europe/CIS/Africa

 

1,397

 

 

 

2,062

 

 

 

4,597

 

 

 

5,665

 

Middle East & Asia

 

1,987

 

 

 

2,553

 

 

 

6,559

 

 

 

7,343

 

Eliminations & other

 

10

 

 

 

62

 

 

 

98

 

 

 

171

 

 

$

5,258

 

 

$

8,541

 

 

$

18,069

 

 

$

24,689

 

 

North America and International revenue disaggregated by segment was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

143

 

 

$

863

 

 

$

4

 

 

$

1,010

 

Drilling

 

226

 

 

 

1,265

 

 

 

28

 

 

 

1,519

 

Production

 

462

 

 

 

1,338

 

 

 

1

 

 

 

1,801

 

Cameron

 

326

 

 

 

646

 

 

 

(7

)

 

 

965

 

Other

 

-

 

 

 

(21

)

 

 

(16

)

 

 

(37

)

 

$

1,157

 

 

$

4,091

 

 

$

10

 

 

$

5,258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

299

 

 

$

1,347

 

 

$

5

 

 

$

1,651

 

Drilling

 

552

 

 

 

1,861

 

 

 

56

 

 

 

2,469

 

Production

 

1,426

 

 

 

1,726

 

 

 

1

 

 

 

3,153

 

Cameron

 

589

 

 

 

772

 

 

 

2

 

 

 

1,363

 

Other

 

(16

)

 

 

(77

)

 

 

(2

)

 

 

(95

)

 

$

2,850

 

 

$

5,629

 

 

$

62

 

 

$

8,541

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

508

 

 

$

2,851

 

 

$

13

 

 

$

3,372

 

Drilling

 

1,018

 

 

 

4,404

 

 

 

118

 

 

 

5,540

 

Production

 

1,937

 

 

 

4,180

 

 

 

2

 

 

 

6,119

 

Cameron

 

1,173

 

 

 

2,048

 

 

 

14

 

 

 

3,235

 

Other

 

(16

)

 

 

(132

)

 

 

(49

)

 

 

(197

)

 

$

4,620

 

 

$

13,351

 

 

$

98

 

 

$

18,069

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

756

 

 

$

3,898

 

 

$

15

 

 

$

4,669

 

Drilling

 

1,680

 

 

 

5,435

 

 

 

160

 

 

 

7,275

 

Production

 

4,218

 

 

 

4,900

 

 

 

2

 

 

 

9,120

 

Cameron

 

1,771

 

 

 

2,146

 

 

 

32

 

 

 

3,949

 

Other

 

(36

)

 

 

(250

)

 

 

(38

)

 

 

(324

)

 

$

8,389

 

 

$

16,129

 

 

$

171

 

 

$

24,689

 

 

 

Revenue in excess of billings related to contracts where revenue is recognized over time was $0.2 billion at both September 30, 2020 and December 31, 2019.  Such amounts are included within Receivables less allowance for doubtful accounts in the Consolidated Balance Sheet.

Due to the nature of its business, Schlumberger does not have significant backlog.  Total backlog was $2.7 billion at September 30, 2020, of which approximately 65% is expected to be recognized as revenue over the next 12 months.

Billings and cash collections in excess of revenue was $1.0 billion at September 30, 2020 and $0.9 billion at December 31, 2019.  Such amounts are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheet.  

v3.20.2
Pension and Other Postretirement Benefit Plans
9 Months Ended
Sep. 30, 2020
Compensation And Retirement Disclosure [Abstract]  
Pension and Other Postretirement Benefit Plans

13.   Pension and Other Postretirement Benefit Plans

Net pension cost (credit) for the Schlumberger pension plans included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

Service cost

$

10

 

 

$

31

 

 

$

14

 

 

$

32

 

 

$

41

 

 

$

105

 

 

$

41

 

 

$

96

 

Interest cost

 

36

 

 

 

76

 

 

 

45

 

 

 

82

 

 

 

111

 

 

 

226

 

 

 

136

 

 

 

248

 

Expected return on plan assets

 

(58

)

 

 

(148

)

 

 

(58

)

 

 

(148

)

 

 

(175

)

 

 

(443

)

 

 

(173

)

 

 

(446

)

Amortization of prior service cost

 

2

 

 

 

-

 

 

 

3

 

 

 

2

 

 

 

6

 

 

 

-

 

 

 

7

 

 

 

6

 

Amortization of net loss

 

9

 

 

 

39

 

 

 

7

 

 

 

16

 

 

 

31

 

 

 

119

 

 

 

23

 

 

 

47

 

 

$

(1

)

 

$

(2

)

 

$

11

 

 

$

(16

)

 

$

14

 

 

$

7

 

 

$

34

 

 

$

(49

)

 

The net periodic benefit credit for the Schlumberger US postretirement medical plan included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Service cost

$

5

 

 

$

8

 

 

$

23

 

 

$

23

 

Interest cost

 

7

 

 

 

12

 

 

 

27

 

 

 

36

 

Expected return on plan assets

 

(19

)

 

 

(16

)

 

 

(52

)

 

 

(49

)

Amortization of prior service credit

 

(4

)

 

 

(7

)

 

 

(19

)

 

 

(21

)

Curtailment gain

 

-

 

 

 

-

 

 

 

(69

)

 

 

-

 

 

$

(11

)

 

$

(3

)

 

$

(90

)

 

$

(11

)

 

Due to the actions taken by Schlumberger to reduce its global workforce during 2020, Schlumberger experienced a significant reduction in the expected aggregate years of future service of its employees in its US postretirement medical plan. Accordingly, Schlumberger recorded a curtailment gain of $69 million during the second quarter of 2020 relating to this plan. The curtailment gain includes recognition of the decrease in the benefit obligation as well as a portion of the previously unrecognized prior service credit, reflecting the reduction in expected years of future service.  As a result of the curtailment, Schlumberger performed a remeasurement of the plan, which had an immaterial impact.  This gain was classified in Impairments & other in the Consolidated Statement of Loss.  See Note 2 – Charges and Credits.

 

v3.20.2
Charges and Credits (Tables)
9 Months Ended
Sep. 30, 2020
Restructuring And Related Activities [Abstract]  
Summary of Charges and Credits

Schlumberger recorded the following charges and credits during 2020, all of which are classified in Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

First quarter:

 

 

 

 

 

 

 

 

 

 

 

Goodwill

$

3,070

 

 

$

-

 

 

$

3,070

 

Intangible asset impairments

 

3,321

 

 

 

(815

)

 

 

2,506

 

Asset Performance Solutions investments

 

1,264

 

 

 

4

 

 

 

1,268

 

North America pressure pumping impairment

 

587

 

 

 

(133

)

 

 

454

 

Workforce reductions

 

202

 

 

 

(7

)

 

 

195

 

Other

 

79

 

 

 

(9

)

 

 

70

 

Valuation allowance

 

-

 

 

 

164

 

 

 

164

 

Second quarter:

 

 

 

 

 

 

 

 

 

 

 

Workforce reductions

 

1,021

 

 

 

(71

)

 

 

950

 

Asset Performance Solutions investments

 

730

 

 

 

(15

)

 

 

715

 

Fixed asset impairments

 

666

 

 

 

(52

)

 

 

614

 

Inventory write-downs

 

603

 

 

 

(49

)

 

 

554

 

Right-of-use asset impairments

 

311

 

 

 

(67

)

 

 

244

 

Costs associated with exiting certain activities

 

205

 

 

 

25

 

 

 

230

 

Multiclient seismic data impairment

 

156

 

 

 

(2

)

 

 

154

 

Repurchase of bonds

 

40

 

 

 

(2

)

 

 

38

 

Postretirement benefits curtailment gain

 

(69

)

 

 

16

 

 

 

(53

)

Other

 

60

 

 

 

(4

)

 

 

56

 

Third quarter:

 

 

 

 

 

 

 

 

 

 

 

Facility exit charges

 

254

 

 

 

(39

)

 

 

215

 

Workforce reductions

 

63

 

 

 

-

 

 

 

63

 

Other

 

33

 

 

 

(1

)

 

 

32

 

 

$

12,596

 

 

$

(1,057

)

 

$

11,539

 

In connection with the preparation of its third quarter 2019 financial statements, Schlumberger recorded the following charges, all of which are classified as Impairments & other in the Consolidated Statement of Loss:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax

 

 

Tax

 

 

Net

 

Goodwill

$

8,828

 

 

$

(43

)

 

$

8,785

 

Intangible assets

 

1,085

 

 

 

(248

)

 

 

837

 

North America pressure pumping

 

1,575

 

 

 

(344

)

 

 

1,231

 

Other North America-related

 

310

 

 

 

(53

)

 

 

257

 

Argentina

 

127

 

 

 

-

 

 

 

127

 

Equity-method investments

 

231

 

 

 

(12

)

 

 

219

 

Asset Performance Solutions investments

 

294

 

 

 

-

 

 

 

294

 

Other

 

242

 

 

 

(13

)

 

 

229

 

 

$

12,692

 

 

$

(713

)

 

$

11,979

 

v3.20.2
Loss Per Share (Tables)
9 Months Ended
Sep. 30, 2020
Earnings Per Share [Abstract]  
Reconciliation of Loss Per Share

The following is a reconciliation from basic loss per share of Schlumberger to diluted loss per share of Schlumberger:

 

(Stated in millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Third Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(82

)

 

 

1,391

 

 

$

(0.06

)

 

$

(11,383

)

 

 

1,385

 

 

$

(8.22

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

 

Schlumberger

Net Loss

 

 

Average

Shares

Outstanding

 

 

Loss per

Share

 

Nine Months

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

Unvested restricted stock

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

Diluted

$

(10,892

)

 

$

1,389

 

 

$

(7.84

)

 

$

(10,470

)

 

$

1,385

 

 

$

(7.56

)

 

Schedule of Antidilutive Securities Excluded from Computation of Loss Per Share

The number of outstanding options to purchase shares of Schlumberger common stock that were not included in the computation of diluted loss per share, because to do so would have had an antidilutive effect, was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

2019

 

 

2020

 

2019

 

Employee stock options

49

 

47

 

 

49

 

 

40

 

Unvested restricted stock

18

 

 

-

 

 

18

 

 

-

 

 

v3.20.2
Inventories (Tables)
9 Months Ended
Sep. 30, 2020
Inventory Disclosure [Abstract]  
Summary of Inventory

A summary of inventories, which are stated at the lower of average cost or net realizable value, is as follows:  

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Raw materials & field materials

$

1,609

 

 

$

1,857

 

Work in progress

 

520

 

 

 

515

 

Finished goods

 

1,413

 

 

 

1,758

 

 

$

3,542

 

 

$

4,130

 

 

v3.20.2
Fixed Assets (Tables)
9 Months Ended
Sep. 30, 2020
Property Plant And Equipment [Abstract]  
Summary of Fixed Assets

A summary of fixed assets follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

Property, plant & equipment

$

32,128

 

 

$

35,009

 

Less: Accumulated depreciation

 

24,732

 

 

 

25,739

 

 

$

7,396

 

 

$

9,270

 

Depreciation Expense Relating to Fixed Assets

Depreciation expense relating to fixed assets was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

385

 

 

$

499

 

Nine Months

$

1,251

 

 

$

1,525

 

 

v3.20.2
Multiclient Seismic Data (Tables)
9 Months Ended
Sep. 30, 2020
Multiclient Seismic Data [Abstract]  
Change in Carrying Amount of Multiclient Seismic Data

The change in the carrying amount of multiclient seismic data for the nine months ended September 30, 2020 was as follows:

 

(Stated in millions)

 

 

 

 

 

Balance at December 31, 2019

$

568

 

Capitalized in period

 

86

 

Charged to expense

 

(132

)

Impairments (See Note 2)

 

(156

)

Other

 

(22

)

 

$

344

 

 

v3.20.2
Goodwill (Tables)
9 Months Ended
Sep. 30, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Changes in Carrying Amount of Goodwill

The changes in the carrying amount of goodwill by segment were as follows:

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reservoir

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Characterization

 

 

Drilling

 

 

Production

 

 

Cameron

 

 

Total

 

Balance at December 31, 2019

$

4,560

 

 

$

7,092

 

 

$

3,949

 

 

$

441

 

 

$

16,042

 

Impairment (See Note 2)

 

-

 

 

 

(1,659

)

 

 

(1,228

)

 

 

(183

)

 

 

(3,070

)

Impact of changes in exchange rates and other

 

-

 

 

 

10

 

 

 

(17

)

 

 

3

 

 

 

(4

)

Balance at September 30, 2020

$

4,560

 

 

$

5,443

 

 

$

2,704

 

 

$

261

 

 

$

12,968

 

 

v3.20.2
Intangible Assets (Tables)
9 Months Ended
Sep. 30, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Schedule of Intangible Assets by Major Class

The gross book value, accumulated amortization and net book value of intangible assets were as follows:

 

 

(Stated in millions)

 

 

 

 

 

Sept. 30, 2020

 

 

Dec. 31, 2019

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Book Value

 

 

Amortization

 

 

Value

 

 

Book Value

 

 

Amortization

 

 

Value

 

Customer relationships

$

1,744

 

 

$

467

 

 

$

1,277

 

 

$

3,779

 

 

$

868

 

 

$

2,911

 

Technology/technical know-how

 

1,290

 

 

 

467

 

 

 

823

 

 

 

2,498

 

 

 

779

 

 

 

1,719

 

Tradenames

 

767

 

 

 

157

 

 

 

610

 

 

 

1,885

 

 

 

264

 

 

 

1,621

 

Other

 

1,548

 

 

 

685

 

 

 

863

 

 

 

1,514

 

 

 

676

 

 

 

838

 

 

$

5,349

 

 

$

1,776

 

 

$

3,573

 

 

$

9,676

 

 

$

2,587

 

 

$

7,089

 

Amortization Expense Charged to Income for Intangible Assets

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

Third Quarter

$

79

 

 

$

156

 

Nine Months

$

292

 

 

$

480

 

v3.20.2
Long-term Debt (Tables)
9 Months Ended
Sep. 30, 2020
Debt Disclosure [Abstract]  
Summary of Long-term Debt

A summary of Long-term Debt follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

Dec. 31,

 

 

2020

 

 

2019

 

3.65% Senior Notes due 2023

$

1,496

 

 

$

1,495

 

3.90% Senior Notes due 2028

 

1,449

 

 

 

1,444

 

1.375% Guaranteed Notes due 2026

 

1,163

 

 

 

-

 

2.00% Guaranteed Notes due 2032

 

1,163

 

 

 

-

 

0.25% Notes due 2027

 

1,058

 

 

 

550

 

0.50% Notes due 2031

 

1,058

 

 

 

544

 

2.65% Senior Notes due 2030

 

1,250

 

 

 

-

 

2.40% Senior Notes due 2022

 

999

 

 

 

998

 

4.00% Senior Notes due 2025

 

930

 

 

 

929

 

4.30% Senior Notes due 2029

 

845

 

 

 

845

 

3.75% Senior Notes due 2024

 

746

 

 

 

746

 

1.00% Guaranteed Notes due 2026

 

704

 

 

 

665

 

2.65% Senior Notes due 2022

 

598

 

 

 

598

 

0.00% Notes due 2024

 

588

 

 

 

551

 

1.40% Senior Notes due 2025

 

498

 

 

 

-

 

3.63% Senior Notes due 2022

 

295

 

 

 

294

 

7.00% Notes due 2038

 

206

 

 

 

208

 

5.95% Notes due 2041

 

114

 

 

 

114

 

5.13% Notes due 2043

 

99

 

 

 

99

 

4.00% Notes due 2023

 

80

 

 

 

81

 

3.70% Notes due 2024

 

55

 

 

 

55

 

3.30% Senior Notes due 2021

 

-

 

 

 

1,597

 

4.20% Senior Notes due 2021

 

-

 

 

 

600

 

Commercial paper borrowings

 

1,077

 

 

 

2,222

 

Other

 

-

 

 

 

135

 

 

$

16,471

 

 

$

14,770

 

 

v3.20.2
Derivative Instruments and Hedging Activities (Tables)
9 Months Ended
Sep. 30, 2020
Derivative Instruments And Hedging Activities Disclosure [Abstract]  
Effect of Derivative Instruments Designated as Cash Flow Hedges and Not Designated as Hedges on Consolidated Statement of (Loss) Income

The effect of derivative instruments designated as cash flow hedges, and those not designated as hedges, on the Consolidated Statement of Loss was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (Loss) Recognized in Loss

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

Consolidated Statement of Loss Classification

Derivatives designated as cash flow hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(7

)

 

$

(3

)

 

$

(12

)

 

$

(7

)

 

Cost of services/sales

Cross currency swaps

 

197

 

 

 

(2

)

 

 

347

 

 

 

(40

)

 

Cost of services/sales

 

$

190

 

 

$

(5

)

 

$

335

 

 

$

(47

)

 

 

Derivatives not designated as hedges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange contracts

$

(14

)

 

$

-

 

 

$

(12

)

 

$

(8

)

 

Cost of services/sales

 

v3.20.2
Segment Information (Tables)
9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Schedule of Segment Reporting Information, by Segment

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

Third Quarter 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

1,010

 

 

$

169

 

 

$

1,651

 

 

$

360

 

Drilling

 

1,519

 

 

 

144

 

 

 

2,469

 

 

 

306

 

Production

 

1,801

 

 

 

227

 

 

 

3,153

 

 

 

288

 

Cameron

 

965

 

 

 

60

 

 

 

1,363

 

 

 

173

 

Eliminations & other

 

(37

)

 

 

(25

)

 

 

(95

)

 

 

(31

)

 

 

 

 

 

 

575

 

 

 

 

 

 

 

1,096

 

Corporate & other (1)

 

 

 

 

 

(151

)

 

 

 

 

 

 

(231

)

Interest income (2)

 

 

 

 

 

3

 

 

 

 

 

 

 

7

 

Interest expense (3)

 

 

 

 

 

(131

)

 

 

 

 

 

 

(151

)

Charges and credits (4)

 

 

 

 

 

(350

)

 

 

 

 

 

 

(12,692

)

 

$

5,258

 

 

$

(54

)

 

$

8,541

 

 

$

(11,971

)

 

 

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($- million in 2020; $1 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($7 million in 2020; $9 million in 2019).

(4)

See Note 2 – Charges and Credits.

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

Nine Months 2019

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Income (Loss)

 

 

 

 

 

 

Before

 

 

 

 

 

 

Before

 

 

Revenue

 

 

Taxes

 

 

Revenue

 

 

Taxes

 

Reservoir Characterization

$

3,372

 

 

$

538

 

 

$

4,669

 

 

$

959

 

Drilling

 

5,540

 

 

 

594

 

 

 

7,275

 

 

 

914

 

Production

 

6,119

 

 

 

464

 

 

 

9,120

 

 

 

740

 

Cameron

 

3,235

 

 

 

262

 

 

 

3,949

 

 

 

486

 

Eliminations & other

 

(197

)

 

 

(111

)

 

 

(324

)

 

 

(127

)

 

 

 

 

 

 

1,747

 

 

 

 

 

 

 

2,972

 

Corporate & other (1)

 

 

 

 

 

(548

)

 

 

 

 

 

 

(742

)

Interest income (2)

 

 

 

 

 

25

 

 

 

 

 

 

 

25

 

Interest expense (3)

 

 

 

 

 

(397

)

 

 

 

 

 

 

(433

)

Charges and credits (4)

 

 

 

 

 

(12,596

)

 

 

 

 

 

 

(12,692

)

 

$

18,069

 

 

$

(11,769

)

 

$

24,689

 

 

$

(10,870

)

 

Certain prior period amounts have been reclassified to conform to the current period presentation.

(1)

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.  

(2)

Interest income excludes amounts which are included in the segments’ income ($1 million in 2020; $6 million in 2019).

(3)

Interest expense excludes amounts which are included in the segments’ income ($22 million in 2020; $29 million in 2019).

(4)

See Note 2 – Charges and Credits.

Revenue by Geographic Area

 

Revenue by geographic area was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

North America

$

1,157

 

 

$

2,850

 

 

$

4,620

 

 

$

8,389

 

Latin America

 

707

 

 

 

1,014

 

 

 

2,195

 

 

 

3,121

 

Europe/CIS/Africa

 

1,397

 

 

 

2,062

 

 

 

4,597

 

 

 

5,665

 

Middle East & Asia

 

1,987

 

 

 

2,553

 

 

 

6,559

 

 

 

7,343

 

Eliminations & other

 

10

 

 

 

62

 

 

 

98

 

 

 

171

 

 

$

5,258

 

 

$

8,541

 

 

$

18,069

 

 

$

24,689

 

 

Summary of North America and International Revenue Disaggregated by Segment

North America and International revenue disaggregated by segment was as follows:

 

 

 

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

143

 

 

$

863

 

 

$

4

 

 

$

1,010

 

Drilling

 

226

 

 

 

1,265

 

 

 

28

 

 

 

1,519

 

Production

 

462

 

 

 

1,338

 

 

 

1

 

 

 

1,801

 

Cameron

 

326

 

 

 

646

 

 

 

(7

)

 

 

965

 

Other

 

-

 

 

 

(21

)

 

 

(16

)

 

 

(37

)

 

$

1,157

 

 

$

4,091

 

 

$

10

 

 

$

5,258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

299

 

 

$

1,347

 

 

$

5

 

 

$

1,651

 

Drilling

 

552

 

 

 

1,861

 

 

 

56

 

 

 

2,469

 

Production

 

1,426

 

 

 

1,726

 

 

 

1

 

 

 

3,153

 

Cameron

 

589

 

 

 

772

 

 

 

2

 

 

 

1,363

 

Other

 

(16

)

 

 

(77

)

 

 

(2

)

 

 

(95

)

 

$

2,850

 

 

$

5,629

 

 

$

62

 

 

$

8,541

 

 

 

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2020

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

508

 

 

$

2,851

 

 

$

13

 

 

$

3,372

 

Drilling

 

1,018

 

 

 

4,404

 

 

 

118

 

 

 

5,540

 

Production

 

1,937

 

 

 

4,180

 

 

 

2

 

 

 

6,119

 

Cameron

 

1,173

 

 

 

2,048

 

 

 

14

 

 

 

3,235

 

Other

 

(16

)

 

 

(132

)

 

 

(49

)

 

 

(197

)

 

$

4,620

 

 

$

13,351

 

 

$

98

 

 

$

18,069

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months 2019

 

 

North

 

 

 

 

 

 

Eliminations

 

 

 

 

 

 

America

 

 

International

 

 

& other

 

 

Total

 

Reservoir Characterization

$

756

 

 

$

3,898

 

 

$

15

 

 

$

4,669

 

Drilling

 

1,680

 

 

 

5,435

 

 

 

160

 

 

 

7,275

 

Production

 

4,218

 

 

 

4,900

 

 

 

2

 

 

 

9,120

 

Cameron

 

1,771

 

 

 

2,146

 

 

 

32

 

 

 

3,949

 

Other

 

(36

)

 

 

(250

)

 

 

(38

)

 

 

(324

)

 

$

8,389

 

 

$

16,129

 

 

$

171

 

 

$

24,689

 

 

v3.20.2
Pension and Other Postretirement Benefit Plans (Tables)
9 Months Ended
Sep. 30, 2020
Compensation And Retirement Disclosure [Abstract]  
Net Pension Cost (Credit) for Schlumberger Pension Plans and US Postretirement Medical Plan

Net pension cost (credit) for the Schlumberger pension plans included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

 

US

 

 

Int’l

 

Service cost

$

10

 

 

$

31

 

 

$

14

 

 

$

32

 

 

$

41

 

 

$

105

 

 

$

41

 

 

$

96

 

Interest cost

 

36

 

 

 

76

 

 

 

45

 

 

 

82

 

 

 

111

 

 

 

226

 

 

 

136

 

 

 

248

 

Expected return on plan assets

 

(58

)

 

 

(148

)

 

 

(58

)

 

 

(148

)

 

 

(175

)

 

 

(443

)

 

 

(173

)

 

 

(446

)

Amortization of prior service cost

 

2

 

 

 

-

 

 

 

3

 

 

 

2

 

 

 

6

 

 

 

-

 

 

 

7

 

 

 

6

 

Amortization of net loss

 

9

 

 

 

39

 

 

 

7

 

 

 

16

 

 

 

31

 

 

 

119

 

 

 

23

 

 

 

47

 

 

$

(1

)

 

$

(2

)

 

$

11

 

 

$

(16

)

 

$

14

 

 

$

7

 

 

$

34

 

 

$

(49

)

 

The net periodic benefit credit for the Schlumberger US postretirement medical plan included the following components:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

 

Nine Months

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Service cost

$

5

 

 

$

8

 

 

$

23

 

 

$

23

 

Interest cost

 

7

 

 

 

12

 

 

 

27

 

 

 

36

 

Expected return on plan assets

 

(19

)

 

 

(16

)

 

 

(52

)

 

 

(49

)

Amortization of prior service credit

 

(4

)

 

 

(7

)

 

 

(19

)

 

 

(21

)

Curtailment gain

 

-

 

 

 

-

 

 

 

(69

)

 

 

-

 

 

$

(11

)

 

$

(3

)

 

$

(90

)

 

$

(11

)

 

v3.20.2
Basis of Presentation - Additional Information (Detail) - Schlumberger and Liberty Oilfield Services Inc Agreement - OneStim - Revenue
9 Months Ended
Sep. 30, 2020
Aug. 31, 2020
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]    
Percentage of ownership interest   37.00%
Concentration risk, percentage 5.00%  
v3.20.2
Charges and Credits - Summary of Charges and Credits (Detail) - USD ($)
3 Months Ended 6 Months Ended 9 Months Ended
Sep. 30, 2020
Jun. 30, 2020
Mar. 31, 2020
Sep. 30, 2019
Jun. 30, 2019
Sep. 30, 2020
Charges And Credits [Line Items]            
Charges and credits, Pretax       $ 12,692,000,000    
Charges and credits, Tax       (713,000,000)    
Charges and credits, Net       11,979,000,000 $ 0  
Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   $ 40,000,000 $ 3,321,000,000     $ 12,596,000,000
Charges and credits, Tax   (2,000,000) (815,000,000)     (1,057,000,000)
Charges and credits, Net   38,000,000 2,506,000,000     $ 11,539,000,000
Goodwill | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax     3,070,000,000 8,828,000,000    
Charges and credits, Tax       (43,000,000)    
Charges and credits, Net     3,070,000,000 8,785,000,000    
Asset Performance Solutions Investments | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   730,000,000 1,264,000,000 294,000,000    
Charges and credits, Tax   (15,000,000) 4,000,000      
Charges and credits, Net   715,000,000 1,268,000,000 294,000,000    
North America pressure pumping asset impairments | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax     587,000,000 1,575,000,000    
Charges and credits, Tax     (133,000,000) (344,000,000)    
Charges and credits, Net     454,000,000 1,231,000,000    
Workforce reductions | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax $ 63,000,000 1,021,000,000 202,000,000      
Charges and credits, Tax   (71,000,000) (7,000,000)      
Charges and credits, Net 63,000,000 950,000,000 195,000,000      
Other | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax 33,000,000 60,000,000 79,000,000 242,000,000    
Charges and credits, Tax (1,000,000) (4,000,000) (9,000,000) (13,000,000)    
Charges and credits, Net 32,000,000 56,000,000 70,000,000 229,000,000    
Valuation allowance | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Tax     164,000,000      
Charges and credits, Net     $ 164,000,000      
Fixed Asset Impairments | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   666,000,000        
Charges and credits, Tax   (52,000,000)        
Charges and credits, Net   614,000,000        
Inventory Write Down | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   603,000,000        
Charges and credits, Tax   (49,000,000)        
Charges and credits, Net   554,000,000        
Right-of-use Asset Impairments | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   311,000,000        
Charges and credits, Tax   (67,000,000)        
Charges and credits, Net   244,000,000        
Costs Associated With Exiting Certain Activities | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   205,000,000        
Charges and credits, Tax   25,000,000        
Charges and credits, Net   230,000,000        
Multiclient Seismic Data Impairment | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   156,000,000        
Charges and credits, Tax   (2,000,000)        
Charges and credits, Net   154,000,000        
Postretirement Benefits Curtailment Gain | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax   (69,000,000)        
Charges and credits, Tax   16,000,000        
Charges and credits, Net   $ (53,000,000)        
Facility exit charges | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax 254,000,000          
Charges and credits, Tax (39,000,000)          
Charges and credits, Net $ 215,000,000          
Intangible Assets | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax       1,085,000,000    
Charges and credits, Tax       (248,000,000)    
Charges and credits, Net       837,000,000    
Other North America - Related | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax       310,000,000    
Charges and credits, Tax       (53,000,000)    
Charges and credits, Net       257,000,000    
Argentina | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax       127,000,000    
Charges and credits, Net       127,000,000    
Equity Method Investment, Other Than Temporary Impairment | Impairment and Other            
Charges And Credits [Line Items]            
Charges and credits, Pretax       231,000,000    
Charges and credits, Tax       (12,000,000)    
Charges and credits, Net       $ 219,000,000    
v3.20.2
Charges and Credits - Additional Information (Detail)
3 Months Ended 6 Months Ended 9 Months Ended
Aug. 31, 2019
USD ($)
Unit
Sep. 30, 2020
USD ($)
Jun. 30, 2020
USD ($)
Emp
Mar. 31, 2020
USD ($)
Unit
Sep. 30, 2019
USD ($)
Jun. 30, 2019
USD ($)
Sep. 30, 2019
USD ($)
Dec. 31, 2019
USD ($)
Charges And Credits [Line Items]                
Total number of reporting units | Unit 17     11        
Goodwill       $ 16,000,000,000.0        
Goodwill impairment charge       $ 3,100,000,000        
Goodwill $ 25,000,000,000.0 $ 12,968,000,000           $ 16,042,000,000
Expected increase/decrease in discount rate assumption       0.50%        
Number of reporting units fair value to be impacted | Unit       7        
Intangible assets 1,085,000,000.000     $ 3,300,000,000        
Restructuring and asset impairment charges     $ 40,000,000          
Expected increase in discount rate assumption         0.50%      
Increase in goodwill impairment charge         $ 300,000,000      
Expected decrease in discount rate assumption         0.50%      
Decrease in goodwill impairment charge         $ 400,000,000      
Charges And Credits         11,979,000,000 $ 0    
North America                
Charges And Credits [Line Items]                
Intangible assets 243,000,000              
Carrying Value Of Impaired Intangible Asset                
Charges And Credits [Line Items]                
Intangible assets       900,000,000        
Carrying Value Of Impaired Intangible Asset | North America                
Charges And Credits [Line Items]                
Intangible assets       1,300,000,000        
North America pressure pumping asset impairments | North America                
Charges And Credits [Line Items]                
Intangible assets 1,575,000,000     600,000,000        
Severance                
Charges And Credits [Line Items]                
Intangible assets 13,000,000     202,000,000     $ 62,000,000  
Severance | North America                
Charges And Credits [Line Items]                
Intangible assets 10,000,000              
Severance | Argentina                
Charges And Credits [Line Items]                
Intangible assets         29,000,000      
Other Restructuring                
Charges And Credits [Line Items]                
Intangible assets       79,000,000     45,000,000  
Valuation allowance | North America                
Charges And Credits [Line Items]                
Intangible assets       164,000,000        
Asset Performance Solutions Investments | Latin America                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     730,000,000          
Fixed Asset Impairments                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     666,000,000          
Fixed Asset Impairments | North America                
Charges And Credits [Line Items]                
Intangible assets 230,000,000              
Inventory Write Down                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     603,000,000          
Inventory Write Down | North America                
Charges And Credits [Line Items]                
Intangible assets 70,000,000              
Right-of-use Asset Impairments                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     311,000,000          
Costs Associated With Exiting Certain Activities                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     205,000,000          
Multiclient Seismic Data Impairment                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     156,000,000          
Allowance For Doubtful Accounts                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     42,000,000          
Postretirement Benefits Curtailment Gain                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     69,000,000          
Facility Exit Costs                
Charges And Credits [Line Items]                
Restructuring charges   254,000,000            
Workforce reductions                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     $ 1,021,000,000.000          
Reduction in workforce | Emp     21,000          
Restructuring charges   63,000,000            
Other                
Charges And Credits [Line Items]                
Restructuring and asset impairment charges     $ 60,000,000          
Restructuring charges   $ 33,000,000            
Charges of Pressure Pumping Equipment                
Charges And Credits [Line Items]                
Intangible assets 1,324,000,000              
Operating Lease Right-of-use Asset                
Charges And Credits [Line Items]                
Intangible assets 98,000,000              
Supplies Expense                
Charges And Credits [Line Items]                
Intangible assets 121,000,000              
Inventory Charges                
Charges And Credits [Line Items]                
Intangible assets 19,000,000              
Charges Related to Other Businesses | North America                
Charges And Credits [Line Items]                
Intangible assets 310,000,000              
Production Related Impairment or Charges | Argentina                
Charges And Credits [Line Items]                
Intangible assets         127,000,000      
Asset Impairment Charges | Argentina                
Charges And Credits [Line Items]                
Intangible assets         72,000,000      
Devaluation Charge | Argentina                
Charges And Credits [Line Items]                
Intangible assets         $ 26,000,000      
Equity Method Investment, Other Than Temporary Impairment                
Charges And Credits [Line Items]                
Intangible assets             231,000,000  
Carrying Value of APS                
Charges And Credits [Line Items]                
Intangible assets             294,000,000  
Restructuring Charges                
Charges And Credits [Line Items]                
Intangible assets             242,000,000  
Acceleration of Stock-based Compensation Expense Associated With Certain Individuals                
Charges And Credits [Line Items]                
Intangible assets             57,000,000  
Business Divestiture Costs                
Charges And Credits [Line Items]                
Intangible assets             49,000,000  
Debt Instrument Premium Paid on Repurchase                
Charges And Credits [Line Items]                
Intangible assets             $ 29,000,000  
Cameron                
Charges And Credits [Line Items]                
Intangible assets       2,200,000,000        
Smith International Inc Smith Aand Geoservices                
Charges And Credits [Line Items]                
Intangible assets $ 842,000,000     $ 1,100,000,000        
Minimum                
Charges And Credits [Line Items]                
Discount rate utilized       12.00% 12.50%      
Maximum                
Charges And Credits [Line Items]                
Discount rate utilized       13.50% 14.00%      
Expected percentage change in fair value of reporting units       5.00%        
Four Reporting Units [Member]                
Charges And Credits [Line Items]                
Total number of reporting units | Unit       4        
Goodwill       $ 4,500,000,000        
Seven Reporting Units [Member]                
Charges And Credits [Line Items]                
Total number of reporting units | Unit 7     7        
Goodwill       $ 11,500,000,000        
Goodwill $ 13,800,000,000              
Six Reporting Units                
Charges And Credits [Line Items]                
Total number of reporting units | Unit       6        
Goodwill       $ 8,400,000,000        
Six Reporting Units | Minimum                
Charges And Credits [Line Items]                
Goodwill       200,000,000        
Six Reporting Units | Maximum                
Charges And Credits [Line Items]                
Goodwill       $ 5,000,000,000.0        
Ten Reporting Units                
Charges And Credits [Line Items]                
Total number of reporting units | Unit 10              
Goodwill $ 11,200,000,000              
Nine Reporting Units                
Charges And Credits [Line Items]                
Total number of reporting units | Unit 9              
Goodwill impairment charge $ 8,800,000,000              
Three Reporting Units                
Charges And Credits [Line Items]                
Total number of reporting units | Unit 3              
Goodwill $ 1,500,000,000              
Three Reporting Units | Minimum                
Charges And Credits [Line Items]                
Goodwill 400,000,000              
Three Reporting Units | Maximum                
Charges And Credits [Line Items]                
Goodwill $ 600,000,000              
Tenth Reporting Unit                
Charges And Credits [Line Items]                
Total number of reporting units | Unit 10              
Goodwill $ 900,000,000              
v3.20.2
Loss Per Share - Reconciliation of Loss Per Share (Detail) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Schlumberger Net Income (Loss)        
Basic $ (82) $ (11,383) $ (10,892) $ (10,470)
Diluted $ (82) $ (11,383) $ (10,892) $ (10,470)
Average Shares Outstanding        
Basic 1,391 1,385 1,389 1,385
Diluted 1,391 1,385 1,389 1,385
Earnings (loss) per Share        
Basic $ (0.06) $ (8.22) $ (7.84) $ (7.56)
Diluted $ (0.06) $ (8.22) $ (7.84) $ (7.56)
v3.20.2
Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of Loss Per Share (Detail) - shares
shares in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Employee Stock Options        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount 49 47 49 40
Unvested Restricted Stock        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount 18   18  
v3.20.2
Inventories - Summary of Inventory (Detail) - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Inventory Disclosure [Abstract]    
Raw materials & field materials $ 1,609 $ 1,857
Work in progress 520 515
Finished goods 1,413 1,758
Inventories $ 3,542 $ 4,130
v3.20.2
Fixed Assets - Summary of Fixed Assets (Detail) - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Property Plant And Equipment [Abstract]    
Property, plant & equipment $ 32,128 $ 35,009
Less: Accumulated depreciation 24,732 25,739
Fixed assets less accumulated depreciation $ 7,396 $ 9,270
v3.20.2
Fixed Assets - Depreciation Expense Relating to Fixed Assets (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Property Plant And Equipment [Abstract]        
Depreciation expense relating to fixed assets $ 385 $ 499 $ 1,251 $ 1,525
v3.20.2
Multiclient Seismic Data - Change in Carrying Amount of Multiclient Seismic Data (Detail)
$ in Millions
9 Months Ended
Sep. 30, 2020
USD ($)
Multiclient Seismic Data [Abstract]  
Opening balance $ 568
Capitalized in period 86
Charged to expense (132)
Impairments (See Note 2) (156)
Other (22)
Ending balance $ 344
v3.20.2
Goodwill - Changes in Carrying Amount of Goodwill (Detail)
$ in Millions
9 Months Ended
Sep. 30, 2020
USD ($)
Goodwill [Line Items]  
Goodwill, Beginning Balance $ 16,042
Impairment (See Note 2) (3,070)
Impact of changes in exchange rates and other (4)
Goodwill, Ending Balance 12,968
Cameron  
Goodwill [Line Items]  
Goodwill, Beginning Balance 441
Impairment (See Note 2) (183)
Impact of changes in exchange rates and other 3
Goodwill, Ending Balance 261
Operating Segments | Reservoir Characterization  
Goodwill [Line Items]  
Goodwill, Beginning Balance 4,560
Goodwill, Ending Balance 4,560
Operating Segments | Drilling  
Goodwill [Line Items]  
Goodwill, Beginning Balance 7,092
Impairment (See Note 2) (1,659)
Impact of changes in exchange rates and other 10
Goodwill, Ending Balance 5,443
Operating Segments | Production  
Goodwill [Line Items]  
Goodwill, Beginning Balance 3,949
Impairment (See Note 2) (1,228)
Impact of changes in exchange rates and other (17)
Goodwill, Ending Balance $ 2,704
v3.20.2
Intangible Assets - Schedule of Intangible Assets by Major Class (Detail) - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Finite Lived Intangible Assets [Line Items]    
Gross Book Value $ 5,349 $ 9,676
Accumulated Amortization 1,776 2,587
Net Book Value 3,573 7,089
Customer Relationships    
Finite Lived Intangible Assets [Line Items]    
Gross Book Value 1,744 3,779
Accumulated Amortization 467 868
Net Book Value 1,277 2,911
Technology/Technical Know-How    
Finite Lived Intangible Assets [Line Items]    
Gross Book Value 1,290 2,498
Accumulated Amortization 467 779
Net Book Value 823 1,719
Tradenames    
Finite Lived Intangible Assets [Line Items]    
Gross Book Value 767 1,885
Accumulated Amortization 157 264
Net Book Value 610 1,621
Other    
Finite Lived Intangible Assets [Line Items]    
Gross Book Value 1,548 1,514
Accumulated Amortization 685 676
Net Book Value $ 863 $ 838
v3.20.2
Intangible Assets - Amortization Expense Charged to Income for Intangible Assets (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Goodwill And Intangible Assets Disclosure [Abstract]        
Amortization expense $ 79 $ 156 $ 292 $ 480
v3.20.2
Intangible Assets - Additional Information (Detail)
$ in Millions
Sep. 30, 2020
USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]  
Estimated amortization charged to income, fourth quarter of 2020 $ 81
Estimated amortization charged to income, 2021 305
Estimated amortization charged to income, 2022 298
Estimated amortization charged to income, 2023 286
Estimated amortization charged to income, 2024 259
Estimated amortization charged to income, 2025 $ 252
v3.20.2
Long-term Debt - Summary of Long-term Debt (Detail) - USD ($)
$ in Millions
Sep. 30, 2020
Dec. 31, 2019
Debt Instrument [Line Items]    
Long-term debt, carrying amount $ 16,471 $ 14,770
3.65% Senior Notes due 2023    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,496 1,495
3.90% Senior Notes due 2028    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,449 1,444
1.375% Guaranteed Notes due 2026    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,163  
2.0% Guaranteed Notes due 2032    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,163  
0.25% Notes due 2027    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,058 550
0.50% Notes due 2031    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,058 544
2.65% Senior Notes due 2030    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 1,250  
2.40% Senior Notes due 2022    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 999 998
4.00% Senior Notes due 2025    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 930 929
4.30% Senior Notes due 2029    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 845 845
3.75% Senior Notes due 2024    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 746 746
1.00% Guaranteed Notes due 2026    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 704 665
2.65% Senior Notes due 2022    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 598 598
0.00% Notes due 2024    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 588 551
1.40% Senior Notes due 2025    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 498  
3.63% Senior Notes due 2022    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 295 294
7.00% Notes due 2038    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 206 208
5.95% Notes due 2041    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 114 114
5.13% Notes due 2043    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 99 99
4.00% Notes due 2023    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 80 81
3.70% Notes due 2024    
Debt Instrument [Line Items]    
Long-term debt, carrying amount 55 55
3.30% Senior Notes due 2021    
Debt Instrument [Line Items]    
Long-term debt, carrying amount   1,597
4.20% Senior Notes due 2021    
Debt Instrument [Line Items]    
Long-term debt, carrying amount   600
Other    
Debt Instrument [Line Items]    
Long-term debt, carrying amount   135
Commercial paper borrowings    
Debt Instrument [Line Items]    
Long-term debt, carrying amount $ 1,077 $ 2,222
v3.20.2
Long-term Debt - Summary of Long-term Debt (Parenthetical) (Detail)
1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Apr. 24, 2019
Sep. 30, 2020
Jun. 30, 2020
Mar. 31, 2020
Sep. 30, 2020
Sep. 30, 2019
Dec. 31, 2019
3.65% Senior Notes due 2023              
Debt Instrument [Line Items]              
Debt instrument interest rate   3.65%     3.65%   3.65%
Debt instrument maturity date         2023   2023
3.90% Senior Notes due 2028              
Debt Instrument [Line Items]              
Debt instrument interest rate 3.90% 3.90%     3.90%   3.90%
Debt instrument maturity date 2028       2028   2028
1.375% Notes due 2026              
Debt Instrument [Line Items]              
Debt instrument interest rate   1.375% 1.375%   1.375%   1.375%
Debt instrument maturity date     2026   2026   2026
2.0% Notes due 2032              
Debt Instrument [Line Items]              
Debt instrument interest rate   2.00% 2.00%   2.00%   2.00%
Debt instrument maturity date     2032   2032   2032
0.25% Notes due 2027              
Debt Instrument [Line Items]              
Debt instrument interest rate   0.25%   0.25% 0.25% 0.25% 0.25%
Debt instrument maturity date       2027 2027 2027 2027
0.50% Notes due 2031              
Debt Instrument [Line Items]              
Debt instrument interest rate   0.50%   0.50% 0.50% 0.50% 0.50%
Debt instrument maturity date       2031 2031 2031 2031
2.65% Senior Notes due 2030              
Debt Instrument [Line Items]              
Debt instrument interest rate   2.65% 2.65%   2.65%   2.65%
Debt instrument maturity date     2030   2030   2030
2.40% Senior Notes due 2022              
Debt Instrument [Line Items]              
Debt instrument interest rate   2.40%     2.40%   2.40%
Debt instrument maturity date         2022   2022
4.00% Senior Notes due 2025              
Debt Instrument [Line Items]              
Debt instrument interest rate   4.00%     4.00%   4.00%
Debt instrument maturity date         2025   2025
4.30% Senior Notes due 2029              
Debt Instrument [Line Items]              
Debt instrument interest rate   4.30%     4.30%   4.30%
Debt instrument maturity date         2029   2029
3.75% Senior Notes due 2024              
Debt Instrument [Line Items]              
Debt instrument interest rate   3.75%     3.75%   3.75%
Debt instrument maturity date         2024   2024
1.00% Guaranteed Notes due 2026              
Debt Instrument [Line Items]              
Debt instrument interest rate   1.00%     1.00%   1.00%
Debt instrument maturity date         2026   2026
2.65% Senior Notes due 2022              
Debt Instrument [Line Items]              
Debt instrument interest rate   2.65%     2.65%   2.65%
Debt instrument maturity date         2022   2022
0.00% Notes due 2024              
Debt Instrument [Line Items]              
Debt instrument interest rate   0.00%     0.00% 0.00% 0.00%
Debt instrument maturity date         2024 2024 2024
1.40% Senior Notes due 2025              
Debt Instrument [Line Items]              
Debt instrument interest rate   1.40%     1.40%   1.40%
Debt instrument maturity date   2025     2025   2025
3.63% Senior Notes due 2022              
Debt Instrument [Line Items]              
Debt instrument interest rate 3.63% 3.63%     3.63%   3.63%
Debt instrument maturity date 2022       2022   2022
7.00% Notes due 2038              
Debt Instrument [Line Items]              
Debt instrument interest rate   7.00%     7.00%   7.00%
Debt instrument maturity date         2038   2038
5.95% Notes due 2041              
Debt Instrument [Line Items]              
Debt instrument interest rate   5.95%     5.95%   5.95%
Debt instrument maturity date         2041   2041
5.13% Notes due 2043              
Debt Instrument [Line Items]              
Debt instrument interest rate   5.13%     5.13%   5.13%
Debt instrument maturity date         2043   2043
4.00% Notes due 2023              
Debt Instrument [Line Items]              
Debt instrument interest rate   4.00%     4.00%   4.00%
Debt instrument maturity date         2023   2023
3.70% Notes due 2024              
Debt Instrument [Line Items]              
Debt instrument interest rate   3.70%     3.70%   3.70%
Debt instrument maturity date         2024   2024
3.30% Senior Notes due 2021              
Debt Instrument [Line Items]              
Debt instrument interest rate   3.30% 3.30%   3.30%   3.30%
Debt instrument maturity date     2021   2021   2021
4.20% Senior Notes due 2021              
Debt Instrument [Line Items]              
Debt instrument interest rate   4.20% 4.20%   4.20%   4.20%
Debt instrument maturity date     2021   2021   2021
v3.20.2
Long-term Debt - Additional Information (Detail)
$ in Thousands, € in Millions
1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Jul. 29, 2020
USD ($)
Apr. 24, 2019
USD ($)
Sep. 30, 2020
USD ($)
Jun. 30, 2020
USD ($)
Mar. 31, 2020
EUR (€)
Sep. 30, 2020
USD ($)
Sep. 30, 2019
USD ($)
Dec. 31, 2019
USD ($)
Jun. 30, 2020
EUR (€)
Dec. 31, 2019
EUR (€)
Sep. 30, 2019
EUR (€)
Debt Instrument [Line Items]                      
Long-term debt, fair value     $ 17,200,000     $ 17,200,000   $ 15,300,000      
Committed credit facility agreement aggregated     8,060,000     8,060,000          
Unused credit facility     6,980,000     6,980,000          
Debt instrument premium paid on repurchase       $ 40,000   29,000          
Long-term debt, carrying amount     16,471,000     16,471,000   $ 14,770,000      
Debt instrument premium paid   $ 48,000                  
0.25% Notes due 2027                      
Debt Instrument [Line Items]                      
Notes, face amount     $ 500,000   € 400 $ 500,000     € 1,000 € 500 € 500
Debt instrument interest rate     0.25%   0.25% 0.25% 0.25% 0.25%   0.25% 0.25%
Debt instrument maturity date         2027 2027 2027 2027      
Long-term debt, carrying amount     $ 1,058,000     $ 1,058,000   $ 550,000      
0.50% Notes due 2031                      
Debt Instrument [Line Items]                      
Notes, face amount         € 400   $ 500,000     € 500  
Debt instrument interest rate     0.50%   0.50% 0.50% 0.50% 0.50%   0.50% 0.50%
Debt instrument maturity date         2031 2031 2031 2031      
Long-term debt, carrying amount     $ 1,058,000     $ 1,058,000   $ 544,000      
1.375% Notes due 2026                      
Debt Instrument [Line Items]                      
Notes, face amount | €                 € 1,000    
Debt instrument interest rate     1.375% 1.375%   1.375%   1.375% 1.375% 1.375%  
Debt instrument maturity date       2026   2026   2026      
Long-term debt, carrying amount     $ 1,163,000     $ 1,163,000          
2.65% Senior Notes due 2030                      
Debt Instrument [Line Items]                      
Notes, face amount       $ 900,000              
Debt instrument interest rate     2.65% 2.65%   2.65%   2.65% 2.65% 2.65%  
Debt instrument maturity date       2030   2030   2030      
Long-term debt, carrying amount     $ 1,250,000     $ 1,250,000          
2.0% Notes due 2032                      
Debt Instrument [Line Items]                      
Notes, face amount | €                 € 1,000    
Debt instrument interest rate     2.00% 2.00%   2.00%   2.00% 2.00% 2.00%  
Debt instrument maturity date       2032   2032   2032      
Long-term debt, carrying amount     $ 1,163,000     $ 1,163,000          
4.20% Senior Notes due 2021                      
Debt Instrument [Line Items]                      
Debt instrument interest rate     4.20% 4.20%   4.20%   4.20% 4.20% 4.20%  
Debt instrument maturity date       2021   2021   2021      
Debt instrument, repurchase amount       $ 600,000              
Long-term debt, carrying amount               $ 600,000      
3.30% Senior Notes due 2021                      
Debt Instrument [Line Items]                      
Debt instrument interest rate     3.30% 3.30%   3.30%   3.30% 3.30% 3.30%  
Debt instrument maturity date       2021   2021   2021      
Debt instrument, repurchase amount       $ 935,000              
Long-term debt, carrying amount               $ 1,597,000      
2.65% Senior Notes due 2030                      
Debt Instrument [Line Items]                      
Notes, face amount     $ 350,000     $ 350,000          
Debt instrument interest rate     2.65%     2.65%          
Debt instrument maturity date     2030                
1.40% Senior Notes due 2025                      
Debt Instrument [Line Items]                      
Notes, face amount     $ 500,000     $ 500,000          
Debt instrument interest rate     1.40%     1.40%   1.40%   1.40%  
Debt instrument maturity date     2025     2025   2025      
Long-term debt, carrying amount     $ 498,000     $ 498,000          
0.00% Notes due 2024                      
Debt Instrument [Line Items]                      
Notes, face amount | €                   € 500 € 500
Debt instrument interest rate     0.00%     0.00% 0.00% 0.00%   0.00% 0.00%
Debt instrument maturity date           2024 2024 2024      
Long-term debt, carrying amount     $ 588,000     $ 588,000   $ 551,000      
3.00% Senior Notes due 2020                      
Debt Instrument [Line Items]                      
Debt instrument interest rate             3.00%       3.00%
Debt instrument maturity date           2020          
Debt instrument, repurchase amount     $ 783,000     $ 783,000          
3.30% Senior Notes due 2021                      
Debt Instrument [Line Items]                      
Debt instrument interest rate             3.625%       3.625%
Debt instrument maturity date           2022          
Debt instrument, repurchase amount             $ 321,000        
3.90% Senior Notes due 2028                      
Debt Instrument [Line Items]                      
Notes, face amount   $ 1,500                  
Debt instrument interest rate   3.90% 3.90%     3.90%   3.90%   3.90%  
Debt instrument maturity date   2028       2028   2028      
Long-term debt, carrying amount     $ 1,449,000     $ 1,449,000   $ 1,444,000      
3.00% Senior Notes due 2020                      
Debt Instrument [Line Items]                      
Debt instrument interest rate   3.00%                  
Debt instrument maturity date   2020                  
Debt instrument, amount exchanged   $ 401,000                  
3.63% Senior Notes due 2022                      
Debt Instrument [Line Items]                      
Debt instrument interest rate   3.63% 3.63%     3.63%   3.63%   3.63%  
Debt instrument maturity date   2022       2022   2022      
Long-term debt, carrying amount     $ 295,000     $ 295,000   $ 294,000      
Debt instrument, amount exchanged   $ 234,000                  
4.00% Senior Notes due 2025                      
Debt Instrument [Line Items]                      
Debt instrument interest rate   4.00%                  
Debt instrument maturity date   2025                  
Debt instrument, amount exchanged   $ 817,000                  
Commercial paper programs mature in April 2021                      
Debt Instrument [Line Items]                      
Committed credit facility agreement aggregated     1,810,000     1,810,000          
Commercial paper programs mature in February 2023                      
Debt Instrument [Line Items]                      
Committed credit facility agreement aggregated     2,750,000     2,750,000          
Commercial paper programs mature in July 2025                      
Debt Instrument [Line Items]                      
Committed credit facility agreement aggregated     1,500,000     1,500,000          
Commercial paper programs mature in February 2025                      
Debt Instrument [Line Items]                      
Committed credit facility agreement aggregated     2,000,000     2,000,000          
Commercial paper borrowings                      
Debt Instrument [Line Items]                      
Long-term debt     1,080,000     1,080,000   2,220,000      
Long-term debt, carrying amount     $ 1,077,000     $ 1,077,000   $ 2,222,000      
Guaranteed Euro Medium Term Note Program                      
Debt Instrument [Line Items]                      
Long-term debt, carrying amount | €                 € 5,000    
Revolving Credit Facility                      
Debt Instrument [Line Items]                      
Committed credit facility agreement aggregated | €                 € 1,540    
Credit facility extended period       1 year              
Credit facility drawn $ 0                    
v3.20.2
Derivative Instruments and Hedging Activities - Additional Information (Detail)
9 Months Ended
Sep. 30, 2020
USD ($)
Country
Jun. 30, 2020
EUR (€)
Mar. 31, 2020
EUR (€)
Dec. 31, 2019
EUR (€)
Sep. 30, 2019
USD ($)
Sep. 30, 2019
EUR (€)
Dec. 31, 2017
USD ($)
Derivative [Line Items]              
Fixed rate debt aggregate $ 16,600,000,000            
Variable rate debt aggregate $ 1,200,000,000            
Number of countries in which Schlumberger generates revenue | Country 120            
Denominated debt issued $ 500,000,000 € 2,000,000,000.0 € 800,000,000 € 1,500,000,000     $ 1,100,000,000
Recognized a cumulative loss in accumulated other comprehensive loss relating to changes in the fair value of foreign currency forward contracts and cross-currency swaps $ 218,000,000            
2.20% Senior Notes due 2020              
Derivative [Line Items]              
Notes, face amount             $ 500,000,000
Derivative swap interest rate             2.20%
2.65% Senior Notes due 2022              
Derivative [Line Items]              
Notes, face amount             $ 600,000,000
Derivative swap interest rate             2.65%
Promissory note interest rate 2.65%     2.65%      
0.00% Notes due 2024              
Derivative [Line Items]              
Notes, face amount | €       € 500,000,000   € 500,000,000  
Derivative swap interest rate       0.00%      
Promissory note interest rate 0.00%     0.00% 0.00% 0.00%  
0.25% Notes due 2027              
Derivative [Line Items]              
Notes, face amount $ 500,000,000 € 1,000,000,000.0 € 400,000,000 € 500,000,000   € 500,000,000  
Derivative swap interest rate 1.40% 1.375% 0.25% 0.25%      
Promissory note interest rate 0.25%   0.25% 0.25% 0.25% 0.25%  
0.50% Notes due 2031              
Derivative [Line Items]              
Notes, face amount     € 400,000,000 € 500,000,000 $ 500,000,000    
Derivative swap interest rate     0.50% 0.50%      
Promissory note interest rate 0.50%   0.50% 0.50% 0.50% 0.50%  
1.40% Senior Notes due 2025              
Derivative [Line Items]              
Notes, face amount $ 500,000,000            
Promissory note interest rate 1.40%     1.40%      
0.50% Notes due 2031              
Derivative [Line Items]              
Notes, face amount | €     € 400,000,000        
Derivative swap interest rate     0.50%        
1.375% Notes due 2026              
Derivative [Line Items]              
Notes, face amount | €   € 1,000,000,000.0          
Derivative swap interest rate   1.375%          
Promissory note interest rate 1.375% 1.375%   1.375%      
2.00% Notes due 2032              
Derivative [Line Items]              
Notes, face amount | €   € 850,000,000          
Derivative swap interest rate   2.00%          
Cross currency swaps              
Derivative [Line Items]              
Notional amount of interest rate swap $ 500,000,000 € 1,850,000,000 € 800,000,000 € 1,500,000,000     $ 1,100,000,000
Promissory note interest rate     2.20% 2.76%      
Cross currency swaps | 2.20% Senior Notes due 2020              
Derivative [Line Items]              
Promissory note interest rate             1.97%
Cross currency swaps | 2.65% Senior Notes due 2022              
Derivative [Line Items]              
Promissory note interest rate             2.52%
Cross currency swaps | 0.00% Notes due 2024              
Derivative [Line Items]              
Promissory note interest rate       2.29%      
Cross currency swaps | 0.25% Notes due 2027              
Derivative [Line Items]              
Promissory note interest rate     1.87% 2.51%      
Cross currency swaps | 1.40% Senior Notes due 2025              
Derivative [Line Items]              
Promissory note interest rate 1.73%            
Cross currency swaps | 1.375% Notes due 2026              
Derivative [Line Items]              
Promissory note interest rate   2.77%          
Cross currency swaps | 2.00% Notes due 2032              
Derivative [Line Items]              
Promissory note interest rate   3.45%          
Foreign exchange contracts              
Derivative [Line Items]              
Notional amount of interest rate swap $ 10,900,000,000            
Foreign exchange contracts | Debt | Derivatives designated as hedges              
Derivative [Line Items]              
Notional amount of interest rate swap $ 6,700,000,000            
v3.20.2
Derivative Instruments and Hedging Activities - Effect of Derivative Instruments Designated as Cash Flow Hedges and Not Designated as Hedges on Consolidated Statement of Income (Loss) (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Derivatives not designated as hedges | Foreign exchange contracts | Cost of services/sales        
Derivative Instruments Gain Loss [Line Items]        
Gain (Loss) Recognized in Income $ (14)   $ (12) $ (8)
Cash Flow Hedging | Derivatives designated as hedges        
Derivative Instruments Gain Loss [Line Items]        
Gain (Loss) Recognized in Income 190 $ (5) 335 (47)
Cash Flow Hedging | Derivatives designated as hedges | Foreign exchange contracts | Cost of services/sales        
Derivative Instruments Gain Loss [Line Items]        
Gain (Loss) Recognized in Income (7) (3) (12) (7)
Cash Flow Hedging | Derivatives designated as hedges | Cross currency swaps | Cost of services/sales        
Derivative Instruments Gain Loss [Line Items]        
Gain (Loss) Recognized in Income $ 197 $ (2) $ 347 $ (40)
v3.20.2
Segment Information - Schedule of Segment Reporting Information, by Segment (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Segment Reporting Information [Line Items]        
Revenue $ 5,258 $ 8,541 $ 18,069 $ 24,689
Income (Loss) Before Taxes (54) (11,971) (11,769) (10,870)
Pretax segment operating income 575 1,096 1,747 2,972
Interest expense 138 160 419 462
Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 1,010 1,651 3,372 4,669
Drilling        
Segment Reporting Information [Line Items]        
Revenue 1,519 2,469 5,540 7,275
Production        
Segment Reporting Information [Line Items]        
Revenue 1,801 3,153 6,119 9,120
Cameron        
Segment Reporting Information [Line Items]        
Revenue 965 1,363 3,235 3,949
Operating Segments        
Segment Reporting Information [Line Items]        
Revenue 5,258 8,541 18,069 24,689
Interest income   1 1 6
Interest expense 7 9 22 29
Operating Segments | Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 1,010 1,651 3,372 4,669
Income (Loss) Before Taxes 169 360 538 959
Operating Segments | Drilling        
Segment Reporting Information [Line Items]        
Revenue 1,519 2,469 5,540 7,275
Income (Loss) Before Taxes 144 306 594 914
Operating Segments | Production        
Segment Reporting Information [Line Items]        
Revenue 1,801 3,153 6,119 9,120
Income (Loss) Before Taxes 227 288 464 740
Operating Segments | Cameron        
Segment Reporting Information [Line Items]        
Revenue 965 1,363 3,235 3,949
Income (Loss) Before Taxes 60 173 262 486
Eliminations & other        
Segment Reporting Information [Line Items]        
Revenue (37) (95) (197) (324)
Income (Loss) Before Taxes (25) (31) (111) (127)
Corporate & other [1] (151) (231) (548) (742)
Interest income 3 [2] 7 [2] 25 [3] 25 [3]
Interest expense (131) [4] (151) [4] (397) [5] (433) [5]
Charges and credits [6] $ (350) $ (12,692) $ (12,596) $ (12,692)
[1] Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.
[2] Interest income excludes amounts which are included in the segments’ income ($- million in 2020; $1 million in 2019).
[3] Interest income excludes amounts which are included in the segments’ income ($1 million in 2020; $6 million in 2019).
[4] Interest expense excludes amounts which are included in the segments’ income ($7 million in 2020; $9 million in 2019).
[5] Interest expense excludes amounts which are included in the segments’ income ($22 million in 2020; $29 million in 2019).
[6] See Note 2 – Charges and Credits.
v3.20.2
Segment Information - Schedule of Segment Reporting Information, by Segment (Parenthetical) (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Segment Reporting Information [Line Items]        
Interest expense $ 138 $ 160 $ 419 $ 462
Operating Segments        
Segment Reporting Information [Line Items]        
Interest income   1 1 6
Interest expense $ 7 $ 9 $ 22 $ 29
v3.20.2
Segment Information - Revenue by Geographic Area (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Segment Reporting Information [Line Items]        
Revenue $ 5,258 $ 8,541 $ 18,069 $ 24,689
Operating Segments        
Segment Reporting Information [Line Items]        
Revenue 5,258 8,541 18,069 24,689
Operating Segments | North America        
Segment Reporting Information [Line Items]        
Revenue 1,157 2,850 4,620 8,389
Operating Segments | Latin America        
Segment Reporting Information [Line Items]        
Revenue 707 1,014 2,195 3,121
Operating Segments | Europe/CIS/Africa        
Segment Reporting Information [Line Items]        
Revenue 1,397 2,062 4,597 5,665
Operating Segments | Middle East & Asia        
Segment Reporting Information [Line Items]        
Revenue 1,987 2,553 6,559 7,343
Eliminations & other        
Segment Reporting Information [Line Items]        
Revenue $ 10 $ 62 $ 98 $ 171
v3.20.2
Segment Information - Summary of North America and International Revenue Disaggregated by Segment (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Segment Reporting Information [Line Items]        
Revenue $ 5,258 $ 8,541 $ 18,069 $ 24,689
Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 1,010 1,651 3,372 4,669
Drilling        
Segment Reporting Information [Line Items]        
Revenue 1,519 2,469 5,540 7,275
Production        
Segment Reporting Information [Line Items]        
Revenue 1,801 3,153 6,119 9,120
Cameron        
Segment Reporting Information [Line Items]        
Revenue 965 1,363 3,235 3,949
Other        
Segment Reporting Information [Line Items]        
Revenue (37) (95) (197) (324)
Operating Segments        
Segment Reporting Information [Line Items]        
Revenue 5,258 8,541 18,069 24,689
Operating Segments | Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 1,010 1,651 3,372 4,669
Operating Segments | Drilling        
Segment Reporting Information [Line Items]        
Revenue 1,519 2,469 5,540 7,275
Operating Segments | Production        
Segment Reporting Information [Line Items]        
Revenue 1,801 3,153 6,119 9,120
Operating Segments | Cameron        
Segment Reporting Information [Line Items]        
Revenue 965 1,363 3,235 3,949
Eliminations & other        
Segment Reporting Information [Line Items]        
Revenue 10 62 98 171
Eliminations & other | Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 4 5 13 15
Eliminations & other | Drilling        
Segment Reporting Information [Line Items]        
Revenue 28 56 118 160
Eliminations & other | Production        
Segment Reporting Information [Line Items]        
Revenue 1 1 2 2
Eliminations & other | Cameron        
Segment Reporting Information [Line Items]        
Revenue (7) 2 14 32
Eliminations & other | Other        
Segment Reporting Information [Line Items]        
Revenue (16) (2) (49) (38)
North America | Operating Segments        
Segment Reporting Information [Line Items]        
Revenue 1,157 2,850 4,620 8,389
North America | Operating Segments | Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 143 299 508 756
North America | Operating Segments | Drilling        
Segment Reporting Information [Line Items]        
Revenue 226 552 1,018 1,680
North America | Operating Segments | Production        
Segment Reporting Information [Line Items]        
Revenue 462 1,426 1,937 4,218
North America | Operating Segments | Cameron        
Segment Reporting Information [Line Items]        
Revenue 326 589 1,173 1,771
North America | Operating Segments | Other        
Segment Reporting Information [Line Items]        
Revenue   (16) (16) (36)
International | Operating Segments        
Segment Reporting Information [Line Items]        
Revenue 4,091 5,629 13,351 16,129
International | Operating Segments | Reservoir Characterization        
Segment Reporting Information [Line Items]        
Revenue 863 1,347 2,851 3,898
International | Operating Segments | Drilling        
Segment Reporting Information [Line Items]        
Revenue 1,265 1,861 4,404 5,435
International | Operating Segments | Production        
Segment Reporting Information [Line Items]        
Revenue 1,338 1,726 4,180 4,900
International | Operating Segments | Cameron        
Segment Reporting Information [Line Items]        
Revenue 646 772 2,048 2,146
International | Operating Segments | Other        
Segment Reporting Information [Line Items]        
Revenue $ (21) $ (77) $ (132) $ (250)
v3.20.2
Segment Information - Additional Information (Detail) - USD ($)
$ in Billions
9 Months Ended
Sep. 30, 2020
Dec. 31, 2019
Segment Reporting [Abstract]    
Revenue in excess of billings $ 0.2 $ 0.2
Total backlog $ 2.7  
Percentage of revenue expected to be recognized over next 12 months 65.00%  
Billings and cash collections in excess of revenue $ 1.0 $ 0.9
v3.20.2
Pension and Other Postretirement Benefit Plans - Net Pension Cost (Credit) for Schlumberger Pension Plans and US Postretirement Medical Plan (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Defined Benefit Plan Disclosure [Line Items]        
Curtailment gain     $ 69  
Postretirement medical plan        
Defined Benefit Plan Disclosure [Line Items]        
Service cost $ 5 $ 8 23 $ 23
Interest cost 7 12 27 36
Expected return on plan assets (19) (16) (52) (49)
Amortization of prior service cost (4) (7) (19) (21)
Total pension cost (credit) (11) (3) (90) (11)
Curtailment gain     (69)  
US        
Defined Benefit Plan Disclosure [Line Items]        
Service cost 10 14 41 41
Interest cost 36 45 111 136
Expected return on plan assets (58) (58) (175) (173)
Amortization of prior service cost 2 3 6 7
Amortization of net loss 9 7 31 23
Total pension cost (credit) (1) 11 14 34
International        
Defined Benefit Plan Disclosure [Line Items]        
Service cost 31 32 105 96
Interest cost 76 82 226 248
Expected return on plan assets (148) (148) (443) (446)
Amortization of prior service cost   2   6
Amortization of net loss 39 16 119 47
Total pension cost (credit) $ (2) $ (16) $ 7 $ (49)
v3.20.2
Pension and Other Postretirement Benefit Plans - Additional Information (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Jun. 30, 2020
Sep. 30, 2020
Defined Benefit Plan Disclosure [Line Items]    
Impact of curtailment   $ (69)
Postretirement medical plan    
Defined Benefit Plan Disclosure [Line Items]    
Impact of curtailment   $ 69
Postretirement medical plan | Impairment and Other    
Defined Benefit Plan Disclosure [Line Items]    
Impact of curtailment $ 69