Halliburton Packs Bags for Dubai

I think it was Henry David Thoreau who noted, "The mass of men lead lives of quiet desperation." He might have added, "until they're awakened by astounding news," such as the report that energy services giant Halliburton (NYSE: HAL  ) is picking up and moving its corporate headquarters from Houston to Dubai.

Speaking over the weekend at an energy conference in Bahrain, Halliburton CEO David Lesar said that while he will maintain an office in Houston, the corporate headquarters for Halliburton will be relocated to the United Arab Emirates. It appears that representatives of Halliburton, which last year earned $2.3 billion on $22.6 billion in revenues, are currently looking for office space in Dubai that is large enough to house a headquarters contingent from the company.

Halliburton is now Houston-based, although its headquarters were in Dallas for most of its corporate existence. Like large oil-services counterparts Schlumberger (NYSE: SLB  ) , Baker-Hughes (NYSE: BHI  ) , and Weatherford (NYSE: WFT  ) , the company operates around the world. It aids oil and gas producers -- from ExxonMobil (NYSE: XOM  ) to small independents -- in their global efforts to locate and produce hydrocarbons.

In recent years, however, Halliburton has frequently been accused of receiving special favors in the procurement of lucrative contracts in Iraq, where it has been active in providing civilian support for the war effort. Many of these accusations appear to have been related to Vice President Dick Cheney's position as CEO of the company from 1995 to 2000.

So there are a couple of ways to evaluate Halliburton's planned move. The first requires more than a modicum of cynicism, and has the company abandoning the U.S. to distance itself from domestic media carping. This probably isn't the case, although the Halliburton I knew as an energy analyst was not the smarmy entity that it's been made out to be in article after article over the past three years.

I like the second approach better. It's based on the world of energy as a global enterprise, with the eastern hemisphere being where the bulk of the action is. After all, more than one-third of the company's 45,000 employees operate in that hemisphere, and as one of the world's top three energy-services companies, Halliburton's role in lifting worldwide crude production by more than 40% over the next couple of decades won't be inconsequential. As I see it, management is simply moving to where the lion's share of that energy activity will be for as long as the eye can see.

So with the positive approach predominating, and given my belief that energy is a sector in which Fools clearly should be represented, I'd urge you to watch the machinations of Halliburton closely.

For related Foolishness:

Fool contributor David Lee Smith owns shares in Schlumberger, but not in the other companies mentioned. He welcomes your comments or questions.


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