.
.
.
EXHIBIT 99.2
ITEM 2. PROPERTIES.
We own or lease numerous properties in domestic and foreign locations.
The following locations represent our major facilities:
Owned/
Location Leased Sq. Footage Description
- ------------------------------------------------------------------------------------------------------
ENERGY SERVICES GROUP
North America
Drilling and Formation
Evaluation Segment:
Dallas, Texas Owned 352,000 Manufacturing facility includes office,
laboratory and warehouse space that
primarily produces roller cone drill
bits. In 2002, we announced plans to
move production from this facility to a
new facility in The Woodlands, Texas.
The planned move is expected in 2003.
Production Optimization Segment:
Carrollton, Texas Owned 792,000 Manufacturing facility including
warehouses, engineering and sales,
testing, training and research. The
manufacturing plant produces equipment
for the Production Optimization segment,
including surface and subsurface safety
valves and packer assemblies.
Shared Facilities:
Duncan, Oklahoma Owned 1,275,000 Four locations which include
manufacturing capacity totaling 655,000
square feet. The manufacturing facility
is the main manufacturing site for the
cementing, fracturing and acidizing
equipment. The Duncan facilities also
include a technology and research
center, training facility,
administrative offices and warehousing.
These facilities service our Drilling
and Formation Evaluation, Fluids and
Production Optimization segments.
Houston, Texas Owned 690,000 Two suburban campus locations utilized
by our Drilling and Formation Evaluation
and Fluids segments. One campus is on 89
acres consisting of office, training,
test well, warehouse, manufacturing and
laboratory facilities. The manufacturing
facility, which occupies 115,000 square
feet, produces highly specialized
downhole equipment for our Drilling and
Formation Evaluation segment. The other
campus is a manufacturing facility with
limited office, laboratory and warehouse
space that primarily produces fixed
cutter drill bits.
Houston, Texas Owned 593,000 A campus facility that is the home
office for the Energy Services Group.
Owned/
Location Leased Sq. Footage Description
- ------------------------------------------------------------------------------------------------------
Shared Facilities (cont'd):
Alvarado, Texas Owned 238,000 Manufacturing facility including some
office and warehouse space. The
manufacturing facility produces
perforating products and exploratory and
formation evaluation tools for our
Drilling and Formation Evaluation and
Production Optimization segments.
Europe/Africa
Production Optimization Segment:
Arbroath, United Kingdom Owned 119,000 Manufacturing site that produces
completion products.
Montrose, United Kingdom Owned 213,000 Service operation center for completion
products and services equipment set on a
7.5 acre site including office,
workshop, warehouse, and yard used as
open storage. Also accommodates a
development center with two training
wells.
Shared Facilities:
Aberdeen, United Kingdom Owned 1,216,000 A total of 26 sites including 866,000
Leased 365,000 square feet of manufacturing capacity
used by various business segments.
Tananger, Norway Leased 319,000 Service center with workshops, testing
facilities, warehousing and office
facilities supporting the Norwegian
North Sea operations.
ENGINEERING AND CONSTRUCTION GROUP
North America
Houston, Texas Leased 851,000 Engineering and project support center
which occupies 33 full floors in 2
office buildings. One of these buildings
is owned by a joint venture in which we
have a 50% ownership. The remaining 50%
of the joint venture is owned by a
subsidiary of Trizec Properties Inc.
(NYSE: TRZ). Trizec is not affiliated
with Halliburton Company or any of its
directors or executive officers.
Houston, Texas Owned 1,017,000 A campus facility occupying 135 acres
utilized primarily for administrative
and support personnel. Approximately
221,000 square feet is dedicated to
maintenance and warehousing of
construction equipment. This campus also
serves as office facilities for KBR's
headquarters and our temporary corporate
headquarters.
Europe/Africa
Leatherhead, United Kingdom Owned 226,000 Engineering and project support center
on 55 acres in suburban London.
In 2002, we closed our Dallas corporate office and temporarily
relocated it to the Houston facility that also serves as headquarters for KBR.
In 2003, the corporate headquarters will be moved from this location to offices
in downtown Houston which are currently being completed.
In addition, we have 181 international and 108 domestic field camps
from which the Energy Services Group delivers its products and services. We also
have numerous small facilities that include sales offices, project offices and
bulk storage facilities throughout the world. We own or lease marine fabrication
facilities covering approximately 761 acres in Texas, England and Scotland which
are used by the Engineering and Construction Group.
We have mineral rights to proven and probable reserves of barite and
bentonite. These rights include leaseholds, mining claims and owned property. We
process barite and bentonite for supply to many industrial markets worldwide in
addition to using it in our Fluids segment. Based on the number of tons of
bentonite consumed in fiscal year 2002, we estimate our 22 million tons of
proven reserves in areas of active mining are sufficient to fulfill our internal
and external needs for the next 15 years. We estimate that our 750,000 tons of
proven reserves of barite in areas of active mining equate to a 27 year supply
based on current rates of production. These estimates are subject to change
based on periodic updates to reserve estimates and to the extent future
consumption differs from current levels of consumption.
We believe all properties that we currently occupy are suitable for their
intended use.