Equibles

10-Q

SLB LIMITED/NV (SLB)

10-Q 2021-07-28 For: 2021-06-30
View Original
Added on April 07, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2021

OR

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

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<br>incorporation or organization) (IRS Employer<br>Identification No.)
42 rue Saint-Dominique
Paris, France 75007
5599 San Felipe
Houston, Texas, United States of America 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:   (713) 513-2000

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 June 30, 2021
COMMON STOCK, $0.01 PAR VALUE PER SHARE 1,398,433,008<br>

SCHLUMBERGER LIMITED

Second Quarter 2021 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 20
Item 3. Quantitative and Qualitative Disclosures about Market Risk 27
Item 4. Controls and Procedures 27
PART II Other Information
Item 1. Legal Proceedings 28
Item 1A. Risk Factors 28
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 28
Item 3. Defaults Upon Senior Securities 28
Item 4. Mine Safety Disclosures 28
Item 5. Other Information 28
Item 6. Exhibits 29

Item 1.  Financial Statements.

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME (LOSS)

(Unaudited)

(Stated in millions, except per share amounts)
Second Quarter Six Months
2021 2020 2021 2020
Revenue
Services $ 3,789 $ 3,721 $ 7,271 $ 9,147
Product sales 1,845 1,635 3,586 3,664
Total Revenue 5,634 5,356 10,857 12,811
Interest & other income 16 33 35 72
Expenses
Cost of services 3,223 3,383 6,255 8,109
Cost of sales 1,545 1,542 3,019 3,439
Research & engineering 134 142 268 315
General & administrative 70 81 150 208
Impairments & other - 3,724 - 12,247
Interest 136 144 272 281
Income (loss) before taxes 542 (3,627 ) 928 (11,716 )
Tax expense (benefit) 99 (199 ) 173 (920 )
Net income (loss) 443 (3,428 ) 755 (10,796 )
Net income attributable to noncontrolling interests 12 6 25 14
Net income (loss) attributable to Schlumberger $ 431 $ (3,434 ) $ 730 $ (10,810 )
Basic income (loss) per share of Schlumberger $ 0.31 $ (2.47 ) $ 0.52 $ (7.79 )
Diluted income (loss) per share of Schlumberger $ 0.30 $ (2.47 ) $ 0.51 $ (7.79 )
Average shares outstanding:
Basic 1,398 1,388 1,398 1,388
Assuming dilution 1,421 1,388 1,420 1,388

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(Stated in millions)
Second Quarter Six Months
2021 2020 2021 2020
Net income (loss) $ 443 $ (3,428 ) $ 755 $ (10,796 )
Currency translation adjustments
Unrealized net change arising during the period (38 ) 19 (24 ) (106 )
Cash flow hedges
Net gain (loss) on cash flow hedges (128 ) (28 ) 22 (231 )
Reclassification to net income (loss) of net realized (gain) loss (3 ) 4 (5 ) 5
Pension and other postretirement benefit plans
Amortization to net income (loss) of net actuarial loss 70 50 133 101
Amortization to net income (loss) of net prior service credit (6 ) (5 ) (11 ) (10 )
Impact of curtailment - (69 ) - (69 )
Income taxes on pension and other postretirement benefit plans (3 ) 14 (3 ) 10
Other (4 ) - (4 ) -
Comprehensive income (loss) 331 (3,443 ) 863 (11,096 )
Comprehensive income attributable to noncontrolling interests 12 6 25 14
Comprehensive income (loss) attributable to Schlumberger $ 319 $ (3,449 ) $ 838 $ (11,110 )

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(Stated in millions)
Dec. 31,
2020
ASSETS
Current Assets
Cash 1,439 $ 844
Short-term investments 1,243 2,162
Receivables less allowance for doubtful accounts (2021 - 314; 2020 - 301) 5,347 5,247
Inventories 3,267 3,354
Other current assets 781 1,312
12,077 12,919
Investments in Affiliated Companies 2,035 2,061
Fixed Assets less accumulated depreciation 6,473 6,826
Goodwill 12,987 12,980
Intangible Assets 3,311 3,455
Other Assets 4,025 4,193
40,908 $ 42,434
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued liabilities 7,635 $ 8,442
Estimated liability for taxes on income 924 1,015
Short-term borrowings and current portion of long-term debt 36 850
Dividends payable 189 184
8,784 10,491
Long-term Debt 15,687 16,036
Postretirement Benefits 956 1,049
Other Liabilities 2,422 2,369
27,849 29,945
Equity
Common stock 12,730 12,970
Treasury stock (2,591 ) (3,033 )
Retained earnings 7,399 7,018
Accumulated other comprehensive loss (4,776 ) (4,884 )
Schlumberger stockholders’ equity 12,762 12,071
Noncontrolling interests 297 418
13,059 12,489
40,908 $ 42,434

All values are in US Dollars.

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

(Stated in millions)
Six Months Ended June 30,
2021 2020
Cash flows from operating activities:
Net income (loss) $ 755 $ (10,796 )
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Impairments and other charges - 12,247
Depreciation and amortization ^(1)^ 1,058 1,396
Deferred taxes (18 ) (1,050 )
Stock-based compensation expense 156 213
Earnings of equity method investments, less dividends received (15 ) (26 )
Change in assets and liabilities: ^(2)^
(Increase) decrease in receivables (114 ) 1,910
Decrease (increase) in inventories 86 (74 )
Decrease in other current assets 538 129
(Increase) decrease in other assets (28 ) 16
Decrease in accounts payable and accrued liabilities (700 ) (2,204 )
Decrease in estimated liability for taxes on income (91 ) (184 )
Increase (decrease) in other liabilities 13 (42 )
Other 9 52
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,649 1,587
Cash flows from investing activities:
Capital expenditures (421 ) (658 )
APS investments (188 ) (224 )
Multiclient seismic data costs capitalized (12 ) (61 )
Business acquisitions and investments, net of cash acquired (35 ) (30 )
Net proceeds from divestitures - 298
Sale (purchase) of investments, net 921 (1,099 )
Other (39 ) (85 )
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 226 (1,859 )
Cash flows from financing activities:
Dividends paid (349 ) (1,386 )
Proceeds from employee stock purchase plan 62 85
Stock repurchase program - (26 )
Proceeds from issuance of long-term debt 34 4,985
Repayment of long-term debt (887 ) (3,070 )
Net (decrease) increase in short-term borrowings (83 ) 73
Other (59 ) (51 )
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (1,282 ) 610
Net increase in cash before translation effect 593 338
Translation effect on cash 2 (13 )
Cash, beginning of period 844 1,137
Cash, end of period $ 1,439 $ 1,462
^(1)^ Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.
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^(2)^ Net of the effect of business acquisitions and divestitures.
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See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(Unaudited)
Accumulated
Other
Retained Comprehensive Noncontrolling
January 1, 2021 – June 30, 2021 In Treasury Earnings Loss Interests Total
Balance, January 1, 2021 12,970 $ (3,033 ) $ 7,018 $ (4,884 ) $ 418 $ 12,489
Net income 730 25 755
Currency translation adjustments (24 ) (2 ) (26 )
Changes in fair value of cash flow hedges 17 17
Pension and other postretirement benefit plans 119 119
Vesting of restricted stock (174 ) 174 -
Shares issued under employee stock purchase plan (202 ) 264 62
Stock-based compensation expense 156 156
Dividends declared (0.250 per share) (349 ) (349 )
Deconsolidation of subsidiary (123 ) (123 )
Other (20 ) 4 (4 ) (21 ) (41 )
Balance, June 30, 2021 12,730 $ (2,591 ) $ 7,399 $ (4,776 ) $ 297 $ 13,059

All values are in US Dollars.
Accumulated
Other
Retained Comprehensive Noncontrolling
January 1, 2020 – June 30, 2020 In Treasury Earnings Loss Interests Total
Balance, January 1, 2020 13,078 $ (3,631 ) $ 18,751 $ (4,438 ) $ 416 $ 24,176
Net loss (10,810 ) 14 (10,796 )
Currency translation adjustments (106 ) (2 ) (108 )
Changes in fair value of cash flow hedges (226 ) (226 )
Pension and other postretirement benefit plans 32 32
Vesting of restricted stock (131 ) 131 -
Shares issued under employee stock purchase plan (95 ) 180 85
Stock repurchase program (26 ) (26 )
Stock-based compensation expense 213 213
Dividends declared (0.625 per share) (868 ) (868 )
Other (21 ) 7 (12 ) (26 )
Balance, June 30, 2020 13,044 $ (3,339 ) $ 7,073 $ (4,738 ) $ 416 $ 12,456

All values are in US Dollars.
Accumulated
Other
Retained Comprehensive Noncontrolling
April 1, 2021 – June 30, 2021 In Treasury Earnings Loss Interests Total
Balance, April 1, 2021 12,663 $ (2,598 ) $ 7,142 $ (4,664 ) $ 429 $ 12,972
Net income 431 12 443
Currency translation adjustments (38 ) (38 )
Changes in fair value of cash flow hedges (131 ) (131 )
Pension and other postretirement benefit plans 61 61
Vesting of restricted stock (3 ) 3 -
Stock-based compensation expense 72 72
Dividends declared (0.125 per share) (174 ) (174 )
Deconsolidation of subsidiary (123 ) (123 )
Other (2 ) 4 (4 ) (21 ) (23 )
Balance, June 30, 2021 12,730 $ (2,591 ) $ 7,399 $ (4,776 ) $ 297 $ 13,059

All values are in US Dollars.
Accumulated
Other
Retained Comprehensive Noncontrolling
April 1, 2020 – June 30, 2020 In Treasury Earnings Loss Interests Total
Balance, April 1, 2020 12,963 $ (3,360 ) $ 10,681 $ (4,723 ) $ 422 $ 15,983
Net loss (3,434 ) 6 (3,428 )
Currency translation adjustments 19 1 20
Changes in fair value of cash flow hedges (24 ) (24 )
Pension and other postretirement benefit plans (10 ) (10 )
Vesting of restricted stock (14 ) 14 -
Stock-based compensation expense 105 105
Dividends declared (0.125 per share) (174 ) (174 )
Other (10 ) 7 (13 ) (16 )
Balance, June 30, 2020 13,044 $ (3,339 ) $ 7,073 $ (4,738 ) $ 416 $ 12,456

All values are in US Dollars.

SHARES OF COMMON STOCK

(Unaudited)

(Stated in millions)
Shares
Issued In Treasury Outstanding
Balance, January 1, 2021 1,434 (42 ) 1,392
Vesting of restricted stock - 2 2
Shares issued under employee stock purchase plan - 4 4
Balance, June 30, 2021 1,434 (36 ) 1,398

See Notes to Consolidated Financial Statements

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 six-month period ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021.  The December 31, 2020 balance sheet information has been derived from the Schlumberger 2020 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, 2020, filed with the Securities and Exchange Commission on January 27, 2021.

2.   Charges and Credits

Schlumberger did not record any charges or credits during the first six months of 2021.

During the first six months of 2020, Schlumberger recorded the following charges and credits, all of which are classified as Impairments & other in the Consolidated Statement of Income (Loss):

(Stated in millions)
Pretax Tax Net
First quarter:
Goodwill $ 3,070 $ - $ 3,070
Intangible assets 3,321 815 2,506
Asset Performance Solutions investments 1,264 (4 ) 1,268
North American pressure pumping 587 133 454
Severance 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 61 4 57
$ 12,247 $ 1,017 $ 11,230

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 that resulted in a $3.1 billion goodwill impairment charge.
---

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 related to Schlumberger’s 2016 acquisition of Cameron International Corporation and $1.1 billion related 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.
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- $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.
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• $202 million of severance.
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• $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.
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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.
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- $730 million relating to the carrying value of certain APS projects in Latin America.
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- $666 million of fixed asset impairments primarily relating to equipment that would no longer be utilized and facilities it exited.
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- $603 million write-down of the carrying value of inventory to its net realizable value.
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- $311 million write-down of right-of-use assets under operating leases associated with leased facilities Schlumberger exited and excess equipment.
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- $205 million of costs associated with exiting certain activities.
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- $156 million impairment of certain multiclient seismic data.
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- $61 million of other costs, including a $42 million increase in the allowance for the doubtful accounts.
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• During the second quarter of 2020, Schlumberger repurchased certain Senior Notes which resulted in a $40 million charge.
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• 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 11 – Pension and Other Postretirement Benefit Plans for further details.
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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 were expected to generate.  Such estimates included unobservable inputs that required significant judgement.

3.   Income (loss) Per Share

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

(Stated in millions, except per share amounts)
2021 2020
Schlumberger<br><br><br>Net Income Average<br><br><br>Shares<br><br><br>Outstanding Income per<br><br><br>Share Schlumberger<br><br><br>Net Loss Average<br><br><br>Shares<br><br><br>Outstanding Loss per<br><br><br>Share
Second Quarter
Basic $ 431 1,398 $ 0.31 $ (3,434 ) 1,388 $ (2.47 )
Unvested restricted stock - 23 - -
Diluted $ 431 1,421 $ 0.30 $ (3,434 ) 1,388 $ (2.47 )
2021 2020
Schlumberger<br><br><br>Net Income Average<br><br><br>Shares<br><br><br>Outstanding Income per<br><br><br>Share Schlumberger<br><br><br>Net Loss Average<br><br><br>Shares<br><br><br>Outstanding Loss per<br><br><br>Share
Six Months
Basic $ 730 $ 1,398 $ 0.52 $ (10,810 ) $ 1,388 $ (7.79 )
Unvested restricted stock - 22 - -
Diluted $ 730 $ 1,420 $ 0.51 $ (10,810 ) $ 1,388 $ (7.79 )

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

(Stated in millions)
Second Quarter Six Months
2021 2020 2021 2020
Employee stock options 44 50 44 50
Unvested restricted stock - 15 - 15

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)
Jun. 30, Dec. 31,
2021 2020
Raw materials & field materials $ 1,500 $ 1,573
Work in progress 471 464
Finished goods 1,296 1,317
$ 3,267 $ 3,354

5.   Fixed Assets

A summary of fixed assets follows:

(Stated in millions)
Jun. 30, Dec. 31,
2021 2020
Property, plant & equipment $ 29,218 $ 29,744
Less: Accumulated depreciation 22,745 22,918
$ 6,473 $ 6,826

Depreciation expense relating to fixed assets was as follows:

(Stated in millions)
2021 2020
Second Quarter $ 352 $ 417
Six Months $ 707 $ 866

6.   Intangible Assets

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

(Stated in millions)
Jun. 30, 2021 Dec. 31, 2020
Gross Accumulated Net Book Gross Accumulated Net Book
Book Value Amortization Value Book Value Amortization Value
Customer relationships $ 1,691 $ 510 $ 1,181 $ 1,744 $ 485 $ 1,259
Technology/technical know-how 1,294 540 754 1,284 488 796
Tradenames 767 182 585 767 166 601
Other 1,523 732 791 1,488 689 799
$ 5,275 $ 1,964 $ 3,311 $ 5,283 $ 1,828 $ 3,455

Amortization expense charged to income was as follows:

(Stated in millions)
2021 2020
Second Quarter $ 75 $ 80
Six Months $ 151 $ 213

Based on the net book value of intangible assets at June 30, 2021, amortization charged to income for the subsequent five years is estimated to be: remaining two quarters of 2021—$152 million; 2022—$293 million; 2023—$286 million; 2024—$262 million; 2025—$248 million; and 2026—$244 million.

7.   Long-term Debt

A summary of Long-term Debt follows:

(Stated in millions)
Jun. 30, Dec. 31,
2021 2020
3.65% Senior Notes due 2023 $ 1,497 $ 1,496
3.90% Senior Notes due 2028 1,453 1,450
2.65% Senior Notes due 2030 1,250 1,250
1.375% Guaranteed Notes due 2026 1,191 1,221
2.00% Guaranteed Notes due 2032 1,184 1,214
0.25% Notes due 2027 1,072 1,100
0.50% Notes due 2031 1,071 1,099
2.40% Senior Notes due 2022 999 999
4.00% Senior Notes due 2025 930 930
4.30% Senior Notes due 2029 846 846
3.75% Senior Notes due 2024 747 746
1.00% Guaranteed Notes due 2026 715 736
0.00% Notes due 2024 596 611
2.65% Senior Notes due 2022 599 598
1.40% Senior Notes due 2025 498 498
3.63% Senior Notes due 2022 295 295
7.00% Notes due 2038 205 206
5.95% Notes due 2041 113 114
5.13% Notes due 2043 99 99
4.00% Notes due 2023 80 80
3.70% Notes due 2024 55 55
Commercial paper borrowings 192 393
$ 15,687 $ 16,036

The estimated fair value of Schlumberger’s Long-term Debt, based on quoted market prices at June 30, 2021 and December 31, 2020, was $16.7 billion and $17.3 billion, respectively.

During the second quarter of 2021, Schlumberger replaced its €1.54 billion one-year committed facility with a €750 million three-year committed revolving credit facility maturing in June 2024.  At June 30, 2021 no amounts had been drawn under this facility.

In addition to the revolving credit facility described above, at June 30, 2021, Schlumberger had separate committed credit facility agreements aggregating $5.75 billion with commercial banks, of which $5.56 billion was available and unused.  These committed facilities support commercial paper programs in the United States and Europe, of which $2.75 billion matures in February 2023, $2.0 billion matures in February 2025 and $1.0 billion matures in July 2026.  Interest rates and other terms of borrowing under these lines of credit vary by facility.

Borrowings under the commercial paper programs at June 30, 2021 and December 31, 2020 were $0.2 billion and $0.4 billion, respectively, all of which was classified in Long-term debt in the Consolidated Balance Sheet.

During the second quarter of 2021, Schlumberger repurchased all $665 million of its 3.30% Senior Notes due 2021.

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 Income (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.

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.

8.   Derivative Instruments and Hedging Activities

As a multinational company, Schlumberger conducts its business in over 120 countries.  Schlumberger’s functional currency is primarily the US dollar.

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.  Included in Other Assets was $309 million at June 30, 2021 ($427 million at December 31, 2020) and included in Other Liabilities was $56 million at June 30, 2021 ($13 million at December 31, 2020) relating to the fair value of outstanding cross-currency swap derivatives.  The fair value was determined using a model with inputs that are observable in the market or can be derived or corroborated by observable data.

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 €2.0 billion in order to hedge changes in the fair value of its €1.0 billion of 1.375% Guaranteed Notes due 2026 and €1.0 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 3.49%, respectively.

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 denominated in currencies other than the functional currency.  While Schlumberger uses foreign currency forward contracts 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 Income (Loss), as are changes in the fair value of the hedged item.

At June 30, 2021, contracts were outstanding for the US dollar equivalent of $8.5 billion in various foreign currencies, of which $6.2 billion relates to hedges of debt denominated in currencies other than the functional currency.

Other than the previously mentioned cross-currency swaps, the fair value of the other outstanding derivatives was not material at June 30, 2021 and December 31, 2020.

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

(Stated in millions)
Gain (Loss) Recognized in Income (Loss)
Second Quarter Six Months
2021 2020 2021 2020 Consolidated Statement of Income (Loss) Classification
Derivatives designated as cash flow hedges:
Cross currency swaps $ 38 $ 92 $ (178 ) $ 150 Cost of services/sales
Foreign exchange contracts 3 (4 ) 5 (5 ) Cost of services/sales
$ 41 $ 88 $ (173 ) $ 145
Derivatives not designated as hedges:
Foreign exchange contracts $ (32 ) $ 11 $ (26 ) $ 2 Cost of services/sales

9.   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.

10.   Segment Information

(Stated in millions)
Second Quarter 2021 Second Quarter 2020
Income Income (Loss)
Before Before
Revenue Taxes Revenue Taxes
Digital & Integration $ 817 $ 274 $ 619 $ 108
Reservoir Performance 1,117 156 1,170 22
Well Construction 2,110 272 2,089 180
Production Systems 1,681 171 1,557 145
Eliminations & other (91 ) (66 ) (79 ) (59 )
807 396
Corporate & other ^(1)^ (138 ) (169 )
Interest income ^(2)^ 5 7
Interest expense ^(3)^ (132 ) (137 )
Charges and credits ^(4)^ - (3,724 )
$ 5,634 $ 542 $ 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 ($1 million in 2021; $- million in 2020).
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^(3)^ Interest expense excludes amounts which are included in the segments’ income ($4 million in 2021; $7 million in 2020).
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^(4)^ See Note 2 – Charges and Credits.
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(Stated in millions)
--- --- --- --- --- --- --- --- --- --- --- --- ---
Six Months 2021 Six Months 2020
Income Income (Loss)
Before Before
Revenue Taxes Revenue Taxes
Digital & Integration $ 1,590 $ 521 $ 1,503 $ 259
Reservoir Performance 2,119 258 3,139 156
Well Construction 4,045 482 4,904 511
Production Systems 3,271 309 3,469 336
Eliminations & other (168 ) (99 ) (204 ) (90 )
1,471 1,172
Corporate & other ^(1)^ (288 ) (397 )
Interest income ^(2)^ 9 22
Interest expense ^(3)^ (264 ) (266 )
Charges and credits ^(4)^ - (12,247 )
$ 10,857 $ 928 $ 12,811 $ (11,716 )
^(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.
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^(2)^ Interest income excludes amounts which are included in the segments’ income ($1 million in 2021; $1 million in 2020).
--- ---
^(3)^ Interest expense excludes amounts which are included in the segments’ income ($8 million in 2021; $15 million in 2020).
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^(4)^ See Note 2 – Charges and Credits.
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Revenue by geographic area was as follows:

(Stated in millions)
Second Quarter Six Months
2021 2020 2021 2020
North America $ 1,083 $ 1,097 $ 2,055 $ 3,277
Latin America 1,057 629 2,095 1,675
Europe/CIS/Africa 1,453 1,449 2,709 3,201
Middle East & Asia 2,001 2,146 3,918 4,573
Eliminations & other 40 35 80 85
$ 5,634 $ 5,356 $ 10,857 $ 12,811

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

(Stated in millions)
Second Quarter 2021
North Eliminations
America International & other Total
Digital & Integration $ 191 $ 625 $ 1 $ 817
Reservoir Performance 79 1,038 - 1,117
Well Construction 352 1,708 50 2,110
Production Systems 458 1,220 3 1,681
Eliminations & other 3 (80 ) (14 ) (91 )
$ 1,083 $ 4,511 $ 40 $ 5,634
Second Quarter 2020
North Eliminations
America International & other Total
Digital & Integration $ 145 $ 470 $ 4 $ 619
Reservoir Performance 215 952 3 1,170
Well Construction 331 1,704 54 2,089
Production Systems 409 1,146 2 1,557
Eliminations & other (3 ) (48 ) (28 ) (79 )
$ 1,097 $ 4,224 $ 35 $ 5,356
(Stated in millions)
--- --- --- --- --- --- --- --- --- --- --- --- ---
Six Months 2021
North Eliminations
America International & other Total
Digital & Integration $ 352 $ 1,235 $ 3 $ 1,590
Reservoir Performance 157 1,960 2 2,119
Well Construction 663 3,285 97 4,045
Production Systems 878 2,382 11 3,271
Eliminations & other 5 (140 ) (33 ) (168 )
$ 2,055 $ 8,722 $ 80 $ 10,857
Six Months 2020
North Eliminations
America International & other Total
Digital & Integration $ 297 $ 1,202 $ 4 $ 1,503
Reservoir Performance 933 2,201 5 3,139
Well Construction 965 3,827 112 4,904
Production Systems 1,099 2,349 21 3,469
Eliminations & other (17 ) (130 ) (57 ) (204 )
$ 3,277 $ 9,449 $ 85 $ 12,811

Revenue in excess of billings related to contracts where revenue is recognized over time was $0.2 billion at both June 30, 2021 and December 31, 2020.  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 $3.0 billion at June 30, 2021, of which approximately 50% 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 June 30, 2021 and $0.9 billion at December 31, 2020.  Such amounts are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheet.

11.   Pension and Other Postretirement Benefit Plans

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

(Stated in millions)
Second Quarter Six Months
2021 2020 2021 2020
US Int’l US Int’l US Int’l US Int’l
Service cost $ 12 $ 34 $ 16 $ 37 $ 23 $ 67 $ 31 $ 74
Interest cost 31 63 38 75 63 132 75 150
Expected return on plan assets (64 ) (161 ) (59 ) (147 ) (127 ) (319 ) (117 ) (294 )
Amortization of prior service cost - - 2 - - - 4 -
Amortization of net loss 11 59 11 39 22 111 22 79
$ (10 ) $ (5 ) $ 8 $ 4 $ (19 ) $ (9 ) $ 15 $ 9

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

(Stated in millions)
Second Quarter Six Months
2021 2020 2021 2020
Service cost $ 6 $ 9 $ 13 $ 18
Interest cost 8 10 16 20
Expected return on plan assets (12 ) (17 ) (26 ) (34 )
Amortization of prior service credit (6 ) (7 ) (11 ) (14 )
Curtailment gain - (69 ) - (69 )
$ (4 ) $ (74 ) $ (8 ) $ (79 )

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 Income (Loss).  See Note 2 – Charges and Credits.

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

Due to the cyclical nature of the industry in which Schlumberger operates and in order to provide a more meaningful analysis relevant to Schlumberger’s business, this section of the Form 10-Q discusses second-quarter 2021 results of operations and comparisons to first-quarter 2021, as well as the first six months of 2021 results of operations and comparisons to the first six months of 2020.  Detailed financial information with respect to first-quarter 2021 can be found in Part I, Item 1, “Financial Statements” of Schlumberger’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021.

Second Quarter 2021 Compared to First Quarter 2021

(Stated in millions)
Second Quarter 2021 First Quarter 2021
Income Before Income Before
Revenue Taxes Revenue Taxes
Digital & Integration $ 817 $ 274 $ 773 $ 247
Reservoir Performance 1,117 156 1,002 102
Well Construction 2,110 272 1,935 209
Production Systems 1,681 171 1,590 138
Eliminations & other (91 ) (66 ) (77 ) (32 )
807 664
Corporate & other ^(1)^ (138 ) (150 )
Interest income ^(2)^ 5 4
Interest expense ^(3)^ (132 ) (132 )
$ 5,634 $ 542 $ 5,223 $ 386
^(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.
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^(2)^ Interest income excludes amounts which are included in the segments’ income ($1 million in Q2 2021; $1 million in Q1 2021).
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^(3)^ Interest expense excludes amounts which are included in the segments’ income ($4 million in Q2 2021; $4 million in Q1 2021).
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Second-quarter global revenue grew 8% sequentially, outperforming the rig count growth in both North America and the international markets. All four Divisions grew resulting in the highest sequential quarterly revenue growth rate since the second quarter of 2017.

In North America, revenue grew 11% sequentially, representing the highest sequential quarterly growth rate for this area since the third quarter of 2017. This performance was driven by US land revenue, which increased 19% due to higher drilling activity and increased sales of well and surface production systems. Well Construction revenue in US land grew more than 30% sequentially, significantly outperforming the rig count growth of 16%. In addition, Canada land revenue increased despite the spring breakup, due to higher Asset Performance Solutions (“APS”) project revenue, while North America offshore revenue was slightly higher due to sales of subsea production systems.

International revenue grew 7% sequentially with all four Divisions registering growth. The revenue growth outpaced the international rig count increase as activity surpassed the impact of the seasonal recovery in the Northern Hemisphere.

Globally, the second-quarter revenue growth was led by Reservoir Performance and Well Construction, where activity intensified beyond the seasonal recovery. Reservoir Performance revenue increased 12% sequentially due to the seasonal activity rebound in the Northern Hemisphere, in addition to higher exploration and appraisal activity. Well Construction revenue increased 9% sequentially from increased drilling activity in US land and broadly across the international markets, particularly offshore. Digital & Integration revenue increased 6% sequentially due to higher sales of digital solutions and higher APS project revenue. Production Systems revenue grew 6%, primarily due to higher sales of well, surface, and subsea production systems.

Sequentially, second-quarter pretax segment operating income increased 22%. Pretax segment operating margin expanded by 162 basis points (“bps”) to 14%, the highest margin since 2015.

While the rise of the COVID-19 Delta variant and resurgence of related disruptions could impact the pace of economic reopening, industry projections of oil demand reflect the anticipation of a wider vaccine-enabled recovery, improving road mobility, and the impact of various economic stimulus programs. Under this scenario, Schlumberger believes the momentum of international activity growth experienced in the second quarter will continue as the cyclical recovery unfolds. This view is supported by rig count trends, capital spending signals, and customer feedback. In North America, Schlumberger anticipates the growth rate to moderate; however, drilling activity could still surprise to the upside due to private E&P operator spending.

Consequently, absent any further setback in the recovery, Schlumberger continues to see its international revenue growing in the second half of 2021 by double-digits when compared to the second half of last year. This translates into full-year 2021 international revenue growth, setting the stage for a strong baseline moving into 2022 and beyond.

Digital & Integration

Digital & Integration revenue of $817 million increased 6% sequentially primarily due to strong sales of digital solutions and higher APS project revenue.

Digital & Integration pretax operating margin of 33% expanded 147 bps sequentially due to increased high-margin digital solutions sales and improved profitability from APS projects.

Reservoir Performance

Reservoir Performance revenue of $1.1 billion increased 12% sequentially due to higher activity that surpassed the impact of the seasonal rebound in the Northern Hemisphere, resulting in 13% sequential revenue growth internationally.

Reservoir Performance pretax operating margin of 14% expanded 373 bps sequentially. Profitability was boosted by the seasonal recovery in the Northern Hemisphere, higher offshore and exploration activity, and favorable technology mix in wireline activity in Africa and in the Middle East.

Well Construction

Well Construction revenue of $2.1 billion increased 9% sequentially. Stronger North America and international activity beyond the seasonal rebound in the Northern Hemisphere was supported by the rig count increase. North America revenue growth was driven by US land revenue growth of more than 30%, outpacing the US land rig count increase of 16%.

Sequentially, Well Construction pretax operating margin of 13% improved by 209 bps due to higher drilling activity following the seasonal recovery in the Northern Hemisphere, higher drilling in US land, increased volume of activity in Europe & Africa and the Middle East and increased higher-margin offshore exploration activity in Africa.

Production Systems

Production Systems revenue of $1.7 billion increased 6% sequentially driven by higher sales of surface, subsea, and well production systems.

Sequentially, Production Systems pretax operating margin of 10% expanded 146 bps as a result of higher sales of surface, well, and subsea production systems.

Six Months 2021 Compared to Six Months 2020

(Stated in millions)
Six Months 2021 Six Months 2020
Income Income (Loss)
Before Before
Revenue Taxes Revenue Taxes
Digital & Integration $ 1,590 $ 521 $ 1,503 $ 259
Reservoir Performance 2,119 258 3,139 156
Well Construction 4,045 482 4,904 511
Production Systems 3,271 309 3,469 336
Eliminations & other (168 ) (99 ) (204 ) (90 )
1,471 1,172
Corporate & other ^(1)^ (288 ) (397 )
Interest income ^(2)^ 9 22
Interest expense ^(3)^ (264 ) (266 )
Charges and credits ^(4)^ - (12,247 )
$ 10,857 $ 928 $ 12,811 $ (11,716 )
^(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.
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^(2)^ Interest income excludes amounts which are included in the segments’ income ($1 million in 2021; $1 million in 2020).
--- ---
^(3)^ Interest expense excludes amounts which are included in the segments’ income ($8 million in 2021; $15 million in 2020).
--- ---
^(4)^ Charges and credits are described in detail in Note 2 to the Consolidated Financial Statements.
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Six-month 2021 revenue of $10.9 billion decreased 15% year-on-year reflecting the significant fall in activity following the historic demand destruction driven by the COVID-19 pandemic that commenced in early 2020.  More than a year after the unprecedented global health and economic crisis sparked by the pandemic began, customers have gradually increased their spending. Revenue also declined year-on-year, particularly in North America, following the divestitures of the OneStim^®^ pressure pumping business and the low-flow artificial lift business during the fourth quarter 2020.  These divestitures were consistent with Schlumberger’s strategy to focus on high-grading and rationalizing its business portfolio to expand margins, minimize earnings volatility, and focus on more capital efficient businesses.  Excluding the impact of these divestitures, which generated $818 million of revenue (all of which was in North America) during the first six months of 2020, global revenue declined 9% year-on-year.

In North America revenue declined 37% year-on-year; however, excluding the impact of the previously described divestitures, six-month revenue only declined 16%.  International revenue declined 8% driven by significant activity decreases in Europe/CIS/Africa and the Middle East & Asia.

Six-month 2021 pretax operating margin of 14% was 440 bps higher compared to the same period last year despite the 15% decline in revenue, due to the divestiture of certain businesses in North America, which were previously dilutive to margins, combined with reduced depreciation and amortization expense following the asset impairment charges recorded during 2020 and the effects of cost reduction measures.

Digital & Integration

Six-month 2021 revenue of $1.6 billion increased 6% year-on-year primarily driven by higher APS project revenue from higher production and improved oil prices, as well as the absence of production interruptions in the APS projects in Ecuador that were caused by a major land slide in the second quarter of 2020.

Year-on-year, pretax operating margin increased 16 percentage points to 33%.  Operating margin increased due to improved profitability from APS projects as a result of higher oil prices and reduced amortization following the asset impairment charges that were recorded during the first six months of 2020 relating to certain APS investments in North America and Latin America.

Reservoir Performance

Six-month 2021 revenue of $2.1 billion decreased 32% year-on-year largely due to the effects of the pandemic.  The revenue decline also reflected the effects of the OneStim divestiture, which generated $741 million of revenue during the first six months of 2020.  Excluding the impact of the OneStim divestiture, revenue declined 12% year-on-year.

Year-on-year, pretax operating margin increased by 721 bps to 12% despite the significant drop in revenue, primarily due to the divestiture of the OneStim business, which was previously dilutive to margins.

Well Construction

Six-month 2021 revenue of $4.0 billion decreased 18% year-on-year due to the significant drop in rig count in North America and internationally due to the effects of the pandemic.

Year-on-year, pretax operating margin increased 147 bps to 12% despite the significant drop in revenue.  Margin expanded largely as a result of the implementation of cost control measures.

Production Systems

Six-month 2021 revenue of $3.3 billion decreased 6% year-on-year, primarily driven by the North America short-cycle business due to the significant decline in completions activity as a result of the pandemic.

Year-on-year, pretax operating margin decreased 23 bps to 9% due to reduced profitability in midstream and subsea production systems.

Interest and Other Income

Interest & other income consisted of the following:

(Stated in millions)
Second Quarter First Quarter Six Months
2021 2021 2021 2020
Equity in net earnings of affiliated companies $ 10 $ 14 $ 25 $ 49
Interest income 6 5 10 23
$ 16 $ 19 $ 35 $ 72

Other

Research & engineering and General & administrative expenses, as a percentage of Revenue, for the second quarter and first quarter of 2021 and six months ended June 30, 2021 and 2020 were as follows:

Second Quarter First Quarter Six Months
2021 2021 2021 2020
Research & engineering 2.4 % 2.6 % 2.5 % 2.5 %
General & administrative 1.2 % 1.5 % 1.4 % 1.6 %

The effective tax rate for the second quarter of 2021 was 18%, as compared to 19% for the first quarter of 2021.

The effective tax rate for the first six months of 2021 was 19%, as compared to 8% for the same period of 2020.  The increase in the effective tax rate was primarily due to the charges and credits described in Note 2 to the Consolidated Financial Statements which reduced the effective tax rate for the first six months of 2020 by 10 percentage points as a significant portion of these charges were not tax-effective.

Charges and Credits

Schlumberger did not record any charges or credits during the first six months of 2021.

During the first six months of 2020 Schlumberger recorded the following charges and credits 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 assets 3,321 815 2,506
Asset Performance Solutions investments 1,264 (4 ) 1,268
North American pressure pumping 587 133 454
Severance 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 61 4 57
$ 12,247 $ 1,017 $ 11,230

Liquidity and Capital Resources

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

(Stated in millions)
Jun. 30, Jun. 30, Dec. 31,
Components of Liquidity: 2021 2020 2020
Cash $ 1,439 $ 1,462 $ 844
Short-term investments 1,243 2,127 2,162
Short-term borrowings and current portion of long-term debt (36 ) (603 ) (850 )
Long-term debt (15,687 ) (16,763 ) (16,036 )
Net debt ^(1)^ $ (13,041 ) $ (13,777 ) $ (13,880 )
Six Months Ended Jun. 30,
--- --- --- --- --- --- ---
Changes in Liquidity: 2021 2020
Net income (loss) $ 755 $ (10,796 )
Impairment and other charges - 12,247
Depreciation and amortization ^(2)^ 1,058 1,396
Earnings of equity method investments, less dividends received (15 ) (26 )
Deferred taxes (18 ) (1,050 )
Stock-based compensation expense 156 213
Increase in working capital ^(3)^ (758 ) (423 )
US Federal tax refund 477 -
Other (6 ) 26
Cash flow from operations 1,649 1,587
Capital expenditures (421 ) (658 )
APS investments (188 ) (224 )
Multiclient seismic data costs capitalized (12 ) (61 )
Free cash flow ^(4)^ 1,028 644
Dividends paid (349 ) (1,386 )
Proceeds from employee stock plans 62 69
Stock repurchase program - (26 )
Business acquisitions and investments, net of cash acquired plus debt assumed (35 ) (20 )
Net proceeds from asset divestitures - 298
Other (30 ) (130 )
Change in net debt before impact of changes in foreign exchange rates on net debt 676 (551 )
Impact of changes in foreign exchange rates on net debt 163 (99 )
Decrease (increase) in net debt 839 (650 )
Net debt, beginning of period^(1)^ (13,880 ) (13,127 )
Net debt, end of period ^(1)^ $ (13,041 ) $ (13,777 )
^(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.
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^(2)^ Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.^^
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^(3)^ Includes severance payments of approximately $184 million and $426 million during the six months ended June 30, 2021 and 2020, respectively.
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^(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.
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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 at the time, 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 flexibility to address the uncertain environment.  This decision reflected 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.

Key liquidity events during the first six months of 2021 and 2020 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 June 30, 2021.  Schlumberger did not repurchase any of its common stock during the first six months of 2021.  Schlumberger repurchased $26 million of its common stock during the first six months of 2020.
•Capital investments (consisting of capital expenditures, APS investments and multiclient seismic data capitalized) were $0.6 billion during the first six months of 2021 compared to $0.9 billion during the first six months of 2020.  Capital investments during the full year of 2021 are expected to be between $1.5 billion and $1.7 billion as compared to $1.5 billion for the full year 2020.
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• During the second quarter of 2021, Schlumberger repurchased all $665 million of its 3.30% Senior Notes due 2021.
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• During the second quarter of 2021, Schlumberger received a federal tax refund of $477 million relating to the carryback of US net operating losses pursuant to the Coronavirus Aid, Relief and Economy Security Act.
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• 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.
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• 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.
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• 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.
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• 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 Income (Loss).  See Note 2 – Charges and Credits.
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• 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.
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As of June 30, 2021, Schlumberger had $2.68 billion of cash and short-term investments on hand.  Schlumberger had committed debt facility agreements aggregating $6.65 billion, of which $6.45 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 June 30, 2021 were $0.2 billion.

Schlumberger maintains an allowance for doubtful accounts in order to record accounts receivable at their net realizable value.  Judgment is involved in recording and making adjustments to this reserve.  Allowances have been recorded for receivables believed to be uncollectible, including amounts for the resolution of potential credit and other collection issues such as disputed invoices.  Adjustments to the allowance may be required in future periods depending on how such potential issues are resolved, or if the financial condition of Schlumberger’s customers were to deteriorate resulting in an impairment of their ability to make payments.  As a large multinational company with a long history of operating in a cyclical industry, Schlumberger has extensive experience in working with its customers during difficult times to manage its accounts receivable.

Schlumberger generates revenue in more than 120 countries.  As of June 30, 2021, only five of those countries individually accounted for greater than 5% of Schlumberger’s net receivable balance, of which only two (the United States and Mexico) accounted for greater than 10% of such receivables.

At times in recent periods, Schlumberger has experienced delays in payments from its primary customer in Mexico.  Included in Receivables, less allowance for doubtful accounts in the Consolidated Balance Sheet as of June 30, 2021 is approximately $0.7 billion of receivables relating to Mexico.  Schlumberger’s receivables from its primary customer in Mexico are not in dispute and Schlumberger has not historically had any material write-offs due to uncollectible accounts receivable relating to this customer.

FORWARD-LOOKING STATEMENTS

This second-quarter 2021 Form 10-Q, as well as other statements we make, contains “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts. Such statements often contain words such as “expect,” “may,” “can,” “believe,” “predict,” “plan,” “potential,” “projected,” “projections,” “forecast,” “estimate,” “intend,” “anticipate,” “ambition,” “goal,” “target,” “think,” “should,” “could,” “would,” “will,” “see,” “likely,” and other similar words.

Forward-looking statements address matters that are, to varying degrees, uncertain, such as statements about Schlumberger’s financial and performance targets and other forecasts or expectations regarding, or dependent on, its business outlook; growth for Schlumberger as a whole and for each of its Divisions (and for specified business lines, geographic areas or technologies within each Division); oil and natural gas demand and production growth; oil and natural gas prices; forecasts or expectations regarding the energy transition and global climate change; improvements in operating procedures and technology; capital expenditures by Schlumberger and the oil and gas industry; the business strategies of Schlumberger, including digital and “fit for basin,” as well as the strategies of Schlumberger’s customers; Schlumberger’s effective tax rate; Schlumberger’s APS projects, joint ventures, and other alliances; Schlumberger’s response to the COVID-19 pandemic and its preparedness for other widespread health emergencies; access to raw materials; future global economic and geopolitical conditions; future liquidity; 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; Schlumberger’s inability to achieve its financial and performance targets and other forecasts and expectations; Schlumberger’s inability to achieve net-zero carbon emissions goals or interim emissions reduction goals; general economic, geopolitical and business conditions in key regions of the world; foreign currency risk; pricing pressure; inflation; 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 efficiencies and other intended benefits from its business strategies and initiatives, such as digital or Schlumberger 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 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 second-quarter 2021 Form 10-Q are made as of July 28, 2021, 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, 2020. Schlumberger’s exposure to market risk has not changed materially since December 31, 2020.

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.

Item 1. Legal Proceedings.

The information with respect to this Item 1 is set forth under Note 9—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, 2020.

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

Unregistered Sales of Equity Securities

None.

Issuer Repurchases of Equity Securities

As of June 30, 2021, 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 first six months of 2021.

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 second quarter of 2021 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.

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 10.1—Schlumberger 2017 Omnibus Stock Incentive Plan, as amended and restated effective January 21, 2021 (incorporated by reference to Exhibit 10.1 to Schlumberger’s Current Report on Form 8-K filed on April 7, 2021) (+)
Exhibit 10.2—Schlumberger Discounted Stock Purchase Plan, as amended and restated effective January 1, 2021 (incorporated by reference to Exhibit 10.2 to Schlumberger’s Current Report on Form 8-K filed on April 7, 2021) (+)
Exhibit 10.3—Schlumberger Limited 2004 Stock and Deferral Plan for Non-Employee Directors, as amended and restated effective January 21, 2021 (incorporated by reference to Exhibit 10.3 to Schlumberger’s Current Report on Form 8-K filed on April 7, 2021) (+)
* 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.
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+ Compensatory plans or arrangements.
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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.

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<br><br><br>(Registrant)
Date: July 28, 2021 /s/ Howard Guild
Howard Guild
Chief Accounting Officer and Duly Authorized Signatory

30

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 June 30, 2021, (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_12.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
--- ---
  1. 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: July 28, 2021 /s/ Olivier Le Peuch
--- ---
Olivier Le Peuch
Chief Executive Officer

slb-ex312_7.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
--- ---
  1. 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: July 28, 2021 /s/ Stephane Biguet
--- ---
Stephane Biguet
Executive Vice President and Chief Financial Officer

slb-ex321_11.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 June 30, 2021 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: July 28, 2021 /s/ Olivier Le Peuch
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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_8.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 June 30, 2021 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: July 28, 2021 /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_14.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 June 30, 2021.  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 June 30, 2021

[unaudited]

(whole dollars)

Mine or Operating Name/MSHA<br><br><br>Identification Number Section 104<br><br><br>S&S Citations Section<br><br><br>104(b)<br><br><br>Orders Section<br><br><br>104(d)<br><br><br>Citations<br><br><br>and Orders Section<br><br><br>110(b)(2)<br><br><br>Violations Section<br><br><br>107(a)<br><br><br>Orders Total Dollar<br><br><br>Value of MSHA<br><br><br>Assessments<br><br><br>Proposed (1) Total<br><br><br>Number<br><br><br>of Mining<br><br><br>Related<br><br><br>Fatalities Received<br><br><br>Notice of<br><br><br>Pattern of<br><br><br>Violations<br><br><br>Under<br><br><br>Section<br><br><br>104(e)<br><br><br>(yes/no) Received<br><br><br>Notice of<br><br><br>Potential to<br><br><br>Have<br><br><br>Pattern<br><br><br>Under<br><br><br>Section<br><br><br>104(e)<br><br><br>(yes/no) Legal<br><br><br>Actions<br><br><br>Pending as<br><br><br>of Last Day<br><br><br>of Period Legal Actions<br><br><br>Initiated<br><br><br>During Period Legal Actions<br><br><br>Resolved<br><br><br>During<br><br><br>Period
Amelia Barite Plant/1600825 ─ ─ ─ ─ ─ ─ ─ N N ─ ─ ─
Battle Mountain Grinding Plant/2600828 ─ ─ ─ ─ ─ ─(2) ─ 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 ─ ─ ─ ─ ─ ─(2) ─ N N ─ ─ ─
(1) Amounts included are the total dollar value of proposed assessments received from MSHA on or before June 30, 2021, regardless of whether the assessment has been challenged or appealed, for citations and orders occurring during the quarter ended June 30, 2021.  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.
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(2) As of June 30, 2021, MSHA had not yet proposed an assessment for one non-S&S citations at Battle Mountain Grinding Plant/2600828, and one non-S&S citations at Wisconsin Proppants Hixton Mine/4703742.
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