Dave Lesar - Chairman, President, CEO Mark McCollum - EVP and CFO Jeff Miller - EVP and COO Kelly Youngblood - Investor Relations

Jim Wicklund - Credit Suisse Brad Handler - Jefferies & Company Doug Becker - Bank of America Merrill Lynch David Anderson - JPMorgan Angie Sedita - UBS James West - Barclays Capital Waqar Syed - Goldman Sachs Bill Herbert - Simmons & Company

Good day, ladies and gentlemen, and welcome to the Halliburton Fourth Quarter 2013 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this conference call is being recorded. I’d now like to introduce your host for today’s conference, Mr. Kelly Youngblood. Sir, you may begin.

Thank you, Sam. Good morning, and welcome to the Halliburton's fourth quarter 2013 conference call. Today’s call is being webcast and a replay will be available on Halliburton's website for seven days. The press release announcing the fourth quarter results is also available on the Halliburton website. Joining me today are Dave Lesar, CEO, Jeff Miller, COO, and Mark McCollum, CFO. I’d like to remind our audience that some of today’s comments may include forward-looking statements reflecting Halliburton's views about future events and their potential impact on performance. These matters involve risk and uncertainties that could impact operations and financial results and cause our actual results to materially differ from our forward-looking statements. These risks are discussed in Halliburton's Form 10-K for the year ended December 31, 2012, Form 10-Q for the quarter-ended September 30, 2013, recent current reports on Form 8-K and other Securities and Exchange Commission filings. Our comments include non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are included in our fourth quarter press release which, as I have mentioned, can be found on our website. In our discussion today, we will be excluding the financial impact of the fourth quarter charges related to employee severance and other restructuring charges during the quarter of $28 million after-tax or $0.03 per diluted share and the third quarter charges related to employee severance and other restructuring charges during that quarter of $38 million after-tax or $0.04 per diluted share unless otherwise noted. We will welcome questions after we complete our prepared remarks. We ask that you please limit yourself to one question and one related follow-up to allow more time for others who have questions. Now, I will turn the call over to Dave.

Thank you, Kelly, and good morning to everyone. Let me begin with a few of our key accomplishments in 2013. First, I’m very proud to say that we delivered industry leading international revenue growth in 2013, specifically for the full year our Eastern Hemisphere grew a remarkable 17% with profit growth of 23%. That coupled with a solid year in North America resulted in a record year for the Company with revenue totaling $29.4 billion. We also set new revenue records this year in all of our international regions and in both of our divisions. From an operating income perspective we achieved new full year records in our Middle East, Asia region and in six of our 13 product lines. I want to express my gratitude to our 77,000 employees around the globe for their hard work and dedication that helped us deliver these outstanding results. In 2013 we also demonstrated our strong commitment to delivering superior shareholder returns. We repurchased approximately $4.4 billion or 10% of our outstanding shares. We had also increased our dividend twice during the year for a total payout increase of 67% over our 2012 dividend rate. These actions reflect our continued confidence in the strength of our business outlook. We have been and will continue to be relentlessly focused on delivering consistent execution and best-in-class returns. Our strategy has worked well for us and we intend to stay the course. The cornerstones of our strategy remain unchanged, expanding our share within the deepwater market, helping our customers maximize recovery from mature fields and leading in global unconventional development. We believe that these are sustainable growth segments for Halliburton which will allow us to generate superior revenue growth, margins and returns. So I think we had a really good year given what the market gave us. Now before we delve deeper into the fourth quarter, I think I should cut right to the chase and look at how we believe 2014 will play out. I think that will help provide you with some context for the rest of today’s discussion. So let’s start with our 2014 view for all of Halliburton Company. Let me begin by saying that we’re very optimistic about the coming year and our ability to achieve robust revenue and operating income growth for the total company. As we look at the 2014 landscape today, we see the following. Based on customer surveys and some discussions with customers, we see total customer drilling and completion spending increasing by the mid to upper single digit percentages with higher spending percentage increases in the Eastern Hemisphere and a bit lower in North America. However, from Halliburton revenue standpoint, we believe we will outpace the market rate of spending increases in both the Eastern Hemisphere and North America and revenue growth for the full year could approach double-digits. We also believe that overall margins will take a step higher both in Eastern Hemisphere and North America. These expectations provide to framework for our current 2014 operating plan, which reflects continued superior returns, significant higher cash generations, and solid double-digit growth in earnings per share. Now let me do a little bit deeper dive into our outlook and the major market segments. In the Eastern Hemisphere for 2014 we anticipate customer spend to be largely driven by our NOC customers. With the contracts we have in hand, we’re planning on low double-digit revenue growth for the Hemisphere led by Saudi Arabia, Iraq, China and Australia and our Middle East and Asia businesses, and by Russia and Angola and our Europe, Africa, CIS region. We also anticipate 2014 Eastern Hemisphere margins to take a step higher quarter-over-quarter when compared to 2013, approaching 20% by year-end and averaging in the upper teens for the year. In 2013, North America played out as we predicted. We saw market driven by increased drilling and completion efficiencies with a relatively flat overall rig count and industry overcapacity. The volatility of the past few years is evolved into a more stable market environment. In the fourth quarter of 2012, if you recall, we called the bottom on our North America margins and we were right. We've seen a marked improvement in margins since that time. For 2014 we are now forecasting U.S. spending to increase in the mid-single digit range based on recent moderations in liquids pricing outlook. Of course, we naturally believe our growth rates will exceed that increase in customer spend, given our strong position in North America. On the margin front for North America, we believe that over the course of the year, we will see our margins increase about 200 basis points. We expect the U.S. land rig count to modestly increase in 2014, driven primarily by the continued shift to horizontals in the Permian basin. The Permian started 2013 with less than 35% of the rig count running horizontal, but we anticipate more than half the rig count will be horizontal by the end of 2014. We also expect to see a continued trend in higher well efficiencies due to increased pad drilling, more 24-hour operations, rig fleet upgrades and significant advancements in drilling and completion technologies. In 2013 we saw average drilling days per horizontal well drop by approximately 14% compared to 2012 and we anticipate horizontal drilling efficiencies to again improve in the mid to upper single digits in 2014. Storage levels are back near the five-year average, but production levels remained elevated both with associated gas in the liquids plays as well as some continued robust activity in the Marcellus basin. Continued strength in natural gas prices could provide some upside potential, but we are not optimistic there will be a meaningful uptick in gas activities in the near term. With regards to Latin America, we expect 2014 to be a challenging year, with fairly steady activity in all countries, expect Mexico and Brazil, both of which are in transition. As previously communicated, Brazil deepwater drilling activity levels have been both expectations and our expected to be even worst throughout 2014. Petrobras has recently said the deepwater rig count for 2014 will be even less than the already depressed levels of 2013. The entire services industry in Brazil is looking for relief to the over capitalization as that has occurred there in anticipation of a much higher deepwater rig count. No relief has been forthcoming at this point. We have an excellent long-term contract position in Brazil and I still believe it will pay off in the long run, but for now the depreciation and personnel costs of our high capital investment is having a severe downward pressure on Brazil margins. However, we intend to stay the course and with Petrobras to try to gain some relief over the next several quarters. In Mexico, reduced activity levels on land are expected to continue through the first half of 2014, as we transition from our prior South Alliance 2 projects to already identified new opportunities in the country. Last quarter we announced the win of the largest incentivized project contract called Humapa, and I am pleased to say today that based on the preliminary tender results, we are also positioned to win Mesozoic 1, the largest of the integrated mega tender projects. These large contract wins will result in higher revenues in Mexico, but the mobilization for them will take some time. In the meantime, I've made the decision to not reduce our headcount or support costs as these resources will soon be needed on these projects, hopefully by the third quarter. Therefore, this ongoing cost will go directly against our profitability until the revenue stream starts back up. In addition, last year, PEMEX pushed the annual software and consulting blanket order approval process back further into the year, delaying their release until its third and fourth quarters. While it is difficult to predict whether this typical approval process is the new norm, we do know that we will be expanding our consulting work with PEMEX in 2014 and beyond. This could result in us incurring costs that will directly hit our process until the blanket order is signed and revenue can be recognized. Both of these items are transitory in nature, but will clearly lay in our profitability in Mexico for probably the first six months of 2014. And while this is not an optimal outcome, I do strongly believe this approach is in the best interest of our company for the long-term success of our business in Mexico, a market we believe has long-term sustainable value to us. So we are strongly committed to both Mexico and Brazil through this transition period. We believe these issues are short-term bumps on the road, but because of their margins for the Latin America region, we'll likely be in the upward single digits until activity begins to recover in the back half of the year. Over the long-term though, Latin America is expected to an outstanding growth market for us and Jeff will give you some details on that in a bit. So overall our strategy is working well. We intend to stay the course in the coming year. I am optimistic about our ability to grow North American revenue and margins, realize industry leading revenue and margin growth in our international business, which should result in double-digit EPS growth. We also remain focused on consistent execution, superior financial performance and industry-leading returns. Now let me turn the call over to Jeff and he'll give you some operational details.

Thanks, Dave. Good morning, everyone. Let me begin with an overview of our fourth quarter results. Overall, I'm pleased with our operational results. Total company revenue of 7.6 billion was a record quarter for Halliburton with operating income of 1.2 billion. We achieved record revenues this quarter in our completion tools, multi-chem landmark, wireline and perforating and testing product lines. During the quarter, our landmark and testing product lines also set new operating income records. Turning to the geographies, our Eastern Hemisphere has record revenue for the quarter with 14% year-over-year growth, while operating income grew 10% for the same period. Sequentially, East Hemisphere revenue and operating income improved 8% and 14%, respectively, driven by our Middle East Asia region. Relative to the third quarter, Europe, Africa, CIS grew by 4% with slightly higher operating income despite some modest weather issues in the North Sea. The UK led the improvement with increased drilling and offshore wireline activity. Also contributing to the growth was increased stimulation in Boots & Coots activity in Algeria and seasonally higher year-end software sales in Russia and throughout Continental Europe. Partially offsetting the growth was lower drilling and wireline activity in Egypt. In Angola, we performed our first pre-salt deepwater open-hole logging jobs in the country on two wells for Cobalt International. Our open-hole wireline logging suite of tools including nuclear magnetic resonance, imaging, coring, seismic and reservoir formation pressure testing and sampling services delivered high quality petrophysical, geophysical and reservoir information for our customer. We also used our ICE Core fluid analysis technology which debuted in the fourth quarter. We continue to build customer confidence in our technology and formation evaluation capability through jobs like this, and the recent successes logging deepwater discovery wells elsewhere in Africa. In the Middle East Asia region, compared to the prior quarter, revenue and operating income grew by 12% and 28%, respectively. Seasonal year-end software and equipment sales led the improvement for the quarter followed by higher stimulation activity in Australia and increased drilling activity in Malaysia and Thailand. In Indonesia, we received two major project wins in the quarter. The first is a three-year project management win valued at over $200 million to oversee the drilling, logging and testing of challenging high pressure, high temperature geothermal wells. This is the testimony to Halliburton's unique leadership in delivering high pressure, high temperature solutions. The second win is a series of contracts to provide directional drilling, wireline and completion services in a multi-field deepwater project over five years. This is expected to be the largest development today in Indonesia. Also during the quarter, Halliburton successfully completed the first -- the industries first fully acoustic telemetry controlled and monitored deepwater drill stem test. Using our DynaLink Wireless Telemetry System, we send acoustic control signals down hole operating the well test valves and fluid sampling system while also receiving real time reservoir data at surface. The enhanced flexibility and control during this operation saved our customer five rig days. This advancement along with deepwater contract wins in Indonesia and Angola reflect our leading global completions position and our evolution towards becoming a compelling choice for deepwater drilling and evaluation services. As we deploy new technologies into the Eastern Hemisphere we’re seeing strategic upsell opportunities within our existing contracts and have been able to increase pricing accordingly with new contracts. Turning to Latin America; revenue and operating income were essentially flat compared to the third quarter. This is the net result of higher yearend software sales, increased cementing activity and the recognition of a value added tax refund receivable in Brazil which offset a decline in activity related to our Mexico Southern Alliance 2 contract. As discussed on our last earnings call activity levels on the Southern Alliance 2 project has declined meaningfully as PEMEX ramps down the ongoing IPM work in preparation for the mega tender projects. We averaged only three rigs for the Southern Alliance 2 project during the fourth quarter as compared to seven rig average in the third quarter. Further we expect to average two rigs on those project in the first half of 2014. Looking at the Mexico mega tenders, the number of projects tendered dropped from 8 to 10 resulting in only three ATG projects in Northern Mexico plus the original five projects in the south. The remaining ATG projects were also smaller in scope than initially expected. Based on the preliminary results of the bid opening, we are positioned to be awarded work in the Mesozoic, the largest single contract in the mega tender round. The ATG and tertiary projects are the least technically challenging of the tenders and have the highest number of submitted bids. Who would not have been interested in doing these projects at the pricing we saw it took to win them. The Mesozoic work by contrast has extremely complex geology resulting in fewer qualified bidders and will likely result in better margins and returns. As we said before, we are very selective on the integrated projects that we pursue. As a return’s driven organization, we’re only interested in winning work that generates superior margins and returns. We believe that the Mesozoic project and the Humapa contract that will begin in the second quarter that’s squarely in this economic profile. We look forward to the formal award of the mega tenders in the first quarter, mobilization to begin in the second and in full activity levels in the back half of 2014. And in Brazil as Dave said, we saw a significant reduction in drilling activity over the course of 2013. We believe that 2014 will be a very challenging year for Latin America. The uncertainty around the timing of when we will be able to right-size our cost structure in Brazil coupled with the delays to the submission of the mega tenders in Mexico have meet our growth expectations for 2014. Ultimately however this does not change our long-term outlook for Latin America. The transition to the mega tenders in Mexico in conjunction with the start up of our incentivized Humapa contract gives us confidence that activity levels in Mexico will recover as these areas get underway. And in Brazil although drilling activity could continue to decline in the near term, our recent contract wins have a potential term of up to eight years and we believe higher drilling activity levels will resume. Over the long-term we expect both of these countries to continue to be strong contributors to our growth and profitability. Switching to North America, weather related activity disruptions resulted in sequential drop in both revenue and operating income. However activity levels were stronger than expected during the holiday season which helped to minimize that sequential decline. We executed our highest U.S. base count of the year in the month of October and activity levels remain strong throughout most of September before declining during the holidays. Several areas including the Bakken, Permian Basin and Marcellus got off to a slow start in January due to weather disruptions, but activity levels have since resent. We expect first quarter activity levels to be similar to the fourth quarter as our completions calendar is looking very active over the coming months; however this outlook is subject to additional weather delays notably end markets like the Rockies where we have a large market share of position. In addition, we also renewed a number of long-term contracts in the fourth quarter with price concessions that will take effect during the first quarter. Looking ahead our customers continue to focus on horizontal drilling efficiency and multi-well pad operations. Pad wells account for over half our activity today and even in the Permian the last area to shift the horizontal drilling, pad activity is estimated to be over 20% in both the Midland and Delaware Basins. These market conditions underscore the need for our HALvantage initiatives. As you know HALvantage includes Frac of the Future and Battle Red as well as other strategic cost oriented programs. We continue to deploy Q10’s and SandCastle’s into the market and expect to see our fleet cross the 20% mark in the first quarter. The Battle Red program meanwhile is expected to be deployed into over half of our North American operations by the end of the first quarter including the frontline smartphone technology. Once we have a couple of quarters behind this, we intend to provide a more in-depth assessment of the HALvantage rollout. At this time I’d like to give you an update on CYPHER; our Seismic-to-Stimulation Service. CYPHER was launched publicly in the fourth quarter and today we have over two dozen programs running for a number of customers across the major basins. In November we summarized the results of our early tests where we averaged over 20% improvement in production in North America. Today I would like to highlight one of our pilot projects which recently completed its first year. Our customer had a series of underperforming wells in a Barnett asset and Halliburton was engaged to invigorate its program. The first step was to build an earth model from existing seismic, log and core data as well as production results. This phase identified a number of sweet spots including several that have been bypassed in the initial well placement. By understanding where to drill and where to land the wells, the second phase yielded over a 50% uplift and estimated ultimate recovery or EUR per well, and the average CYPHER well produced at a level beyond the best pre existing wells. Our next step was maximizing fracture complexity and production. With each iterative well, the CYPHER service was using Halliburton’s proprietary complex fracture model to learn where to complete the well and then how to complete the well. By the conclusion of the third phase CYPHER had more than doubled the average EUR per well. One year later CYPHER has clearly demonstrated its value. Through the smart service we’re working with the client to continuously incorporate new technology and techniques to improve production not only in this asset but on several others. We believe that CYPHER is a game changer for our customers and for Halliburton. We will change the way we go to market and will significantly differentiate us in the North American frac market. We’re also seeing a consistent adoption of our Custom Chemistry Solutions, including our RockPerm service and it's associated OilPerm Formation Mobility Modifiers. Through RockPerm we demonstrate to our customers how a customized affected package including OilPerm can generate appreciable production improvements compared to offset wells. Since beginning field trials in the second quarter of 2013, Halliburton has utilized RockPerm and OilPerm on over 2000 jobs. Moving to the Gulf of Mexico, we saw sequential revenue and profit improvement from increased drilling activity and the return of one of our larger simulation vessels to service. Going into 2014, we believe we are well positioned with drilling and evaluation of services for the additional 14 to 16 deepwater rigs that are scheduled to arrive during the year. We are also optimistic about the higher levels of completion sales during 2014 given our strong market position in both deepwater and lower tertiary completions. To close out North America, we believe the current environment continues to favor Halliburton. There are two key differentiators with our customers today; efficient, reliable execution and improved production. We believe these trends play the Halliburton strengths as the leading service provider in North America and that our HALvantage and CYPHER initiatives give us a clear competitive advantage. Based on early signals from our customers, we're optimistic about the activity outlook for 2014 and we'll continue to be relentlessly focused on our cost structure to enable margin growth in the coming year. Internationally, we're very pleased with our year-over-year growth in spite of activity headwinds in Latin America. We've led our peer group in delivering international revenue growth and expect to continue to expand our global business in 2014. We believe that continued above-market rate growth will be driven by recent wins and new projects, markets where we've made strategic investments from the introduction of new technology and from modest pricing increases and cost recovery on select contracts. Now Mark will provide some additional financial commentary. Mark?

Thanks, Jeff. Good morning, everyone. As mentioned last quarter, we've been evaluating our cost structure within the organization as we deploy our HALvantage corporate initiatives. These initiatives are having a significant impact on the support and operational headcount needs primarily in North America, as well as equipment and inventory requirements. During the fourth quarter, as we progressed with the rollout of these initiatives, we took further restructuring actions which resulted in severance and other charges during the quarter of approximately $38 million before tax. Our corporate and other expense totaled $99 million this quarter and included approximately $22 million for continued investment in these HALvantage strategic initiatives. These activities will continue throughout 2014, but the related costs should begin to decline in the second half of the year. We anticipate the impact of these investments will again be approximately $0.02 per share after tax in the first quarter. Including these strategic costs, we anticipate that corporate expenses for the first quarter will be in line with the fourth quarter of 2013. Our effective tax rate for the fourth quarter came in lower than anticipated at 26% due to some favorable tax items in Latin America, but our tax rate does continue to fall as our international taxable earnings continue to grow. As we go forward into 2014, we're expecting the first quarter effective tax rate to be approximately 29% which is about 100 basis points than our normalized rate as we exit 2013. This is driven solely by the exploration of the federal research and experimentation tax credit, which we hope will be reapproved by Congress sometime in 2014. Cash flows from operating activities in 2013 were approximately $4.4 billion, representing growth of 22% compared to the prior year. We also generated approximately $1.3 billion in cash adjusted for stock repurchases and a new debt we issued last year. And moving in 2014, we believe we're well positioned to generate significantly more cash and that it will grow sustainably in the coming years. We have previously committed to grow the percentage of cash available for distribution to shareholders up to roughly 35% of our operating cash flows over the next few years, which has nearly doubled our historic trend. And based on our 2013 results, we're well on our way toward achieving this goal. We anticipate that our capital expenditures for 2014 will be approximately $3 billion which is generally consistent with our 2013 spending level. We expect our international spend to continue to outweigh our North America's spend in 2014. We also expect our 2014 depreciation and amortization to be approximately $2.2 billion. During the fourth quarter, our Board of Directors approved the 20% increase in the quarterly dividend from $0.125 to $0.15 per share. This was the second dividend increase in 2013 representing a cumulative 67% increase over our quarterly dividend rate in 2012. As announced earlier in 2013, our intention going forward is for our dividend payout to equal at least 15% to 20% of our net income. Additionally, we currently have approximately $1.7 billion in share repurchase authorization from our Board of Directors that is available to use for stock buybacks. As we moved into 2014, we're anticipating a seasonal sequential decline in international revenue and margins during the first quarter, due to reduced software and equipment sales as well as weather-related weakness in the North Sea, Eurasia and Australia. On a year-over-year basis for the first quarter, we anticipate an upper single digit percentage increase in the Eastern Hemisphere revenue with the modest improvement in margins which is evidence of our expanding international market position. Beginning in the second quarter, we expect Eastern Hemisphere activity levels to recover from the seasonal impact and margins to steadily improve over the course of the year with full year margins averaging in the upper teens. For the Latin America, we expect a seasonal decline in first quarter revenue and margins to be more severe than normal, due to our elevated cost structure in Brazil and the ramp down of the Mexico Southern Alliance 2 project as Jeff discussed a little bit ago. Also, as Dave discussed, the sequential decline is also exacerbated by the timing of our annual consulting blanket order renewal in Mexico. We're currently expecting a mid teens sequential decline in revenue in the first quarter and margins in Latin America to be in the upper single digits. At this time it's difficult to provide full year guidance for Latin America until we hear the outcome of the negotiations with our customer in Brazil and receive formal contract awards in Mexico. Concluding with North America, we're anticipating a typical weather impact in the first quarter plus some additional pricing pressure for contract renewals that went into effect at the beginning of 2014. Subject to severe weather disruptions, we're currently expecting first quarter revenue and margins in North America to be in line with the fourth quarter of 2013. Now, I'll turn the call back over to Dave for some closing comments.

Thanks, Mark. Just in a quick summary, we executed very well in 2013. I believe we had a good year with what the market gave us and delivered what we said we would. Bottom line for 2014 is we expect all of this to translate into double-digit EPS growth. So with that, let's turn it over to questions.

Thank you, sir. (Operator Instructions). Our first question comes from Jim Wicklund of Credit Suisse. Your line is now opened. Jim Wicklund - Credit Suisse: Good morning, gentlemen.

Good morning, Jim. Jim Wicklund - Credit Suisse: Remind to write-off Latin America as my vacation spot for this year. The CapEx that you guys have spent over the last couple of years, primarily in the Eastern Hemisphere setting up locations, et cetera, that we kind of looked at as some costs, are we going to see an improvement in performance on the basis of that this year? Does that kick-in on a noticeable basis this year, the ability to win projects on more of a variable basis than a fully move into the country for the first-time basis?

Yes, we should start seeing that Jim. The initial investment was to get placed in and at this point now that we have the facilities build out, we are – the incremental projects that come along are being bid at sort of the rates that we would expect to recover. And then as we absorb those costs with additional work, again we'll continue to see the improvement in margins.

Part of that, Jim, is why I think we're so confident that Eastern Hemisphere is going to continue to step-up quarter-over-quarter in its margin realizations because to some extent you are now covering those fixed costs with a wider contract base. Jim Wicklund - Credit Suisse: Guys, I just think that's a story that people kind of forget that that's one of the drivers. Okay, and second if I could, record revenues in the entire Eastern Hemisphere, usually if I'm head of Eastern Hemisphere, Dave, and you ask me what am I going to do this year, and me saying, I hope customers spend more, probably doesn't get me a promotion. When you're operating at record revenue level in order to increase returns, don't you have to at some level take some additional risk?

Well, I'm not sure what you mean by risk, but let me take a shot at this. I mean obviously our Eastern Hemisphere is doing well and Joe Rainey who heads that up and his management team, are doing a fantastic job for us. I think really to continue to grow Eastern Hemisphere, one obviously you have to take what the market gives you. And we're seeing some sort of modest level increase in rig count there. So that will help grow the revenue. You have to win more than your normal market share which I believe we’re doing in terms of tender and contract win rates. I’m not sure you necessarily have to take higher risks in your contract pricing. You really have to pick and choose your spots and we have as we said when we responded to the first question we also have a larger footprint in the Eastern Hemisphere now to attack the market off of. So I don’t necessarily think we have to take risk to continue to grow our Eastern Hemisphere business, I think we’re well positioned there. It’s a contract base. We have a great footprint, we have a great management team and I think that will all drive the revenues higher. Jim Wicklund - Credit Suisse: Okay. Gentlemen, thank you very much.

Thank you.

Thank you. Our next question comes from Brad Handler of Jefferies. Your line is now open. Brad Handler - Jefferies & Company: Thanks. Good morning, guys.

Good morning, Brad. Brad Handler - Jefferies & Company: Maybe I could ask you to as you think about ’14 for us, just cut up the business a couple of different ways that you have done so in the past. How would you look at offshore growth internationally or maybe in the Eastern Hemisphere versus onshore growth? It just -- it sounds like a lot of the opportunities you identified were actually onshore or onshore driven for ’14?

I think it’s a healthy mix of both Brad. The offshore rig count we see that continuing to grow and obviously one of our clear strategies is to outgrow the deepwater market which we expect to do, but yes there are number of onshore opportunities as well. We think about Russia and China and then certainly the Middle East. So there is a robust onshore market out there. So I think that they’re evenly weighted and I wouldn’t take one over the other. Brad Handler - Jefferies & Company: I mean when you clearly think about the Gulf of Mexico, the Gulf of Mexico should have a good solid growth here on 2014. Now we did say them at Brazil likely is going to be flat slightly down and that is somewhat of a disappointment and sees 2015 being more of a transition year. But you step away from Brazil, the rest of it -- that offshore market should be good?

Yes. Brad Handler - Jefferies & Company: Okay, all right. That’s helpful color. Asking a similar question, but slightly different than your -- as you’ve identified your Brownfield strategy which I know is a multi-year strategy, but how does that in your minds grow in ’14 versus more traditional sort of Greenfield drilling and completion work?

Well, we see the first step out in Mexico. So as we get into 2014, we see Humapa getting ramped up and so we will see contributions there. We are selective around these projects as we take them. We expect to add a few projects per year. Clearly, Humapa being one of those and we have got a number of other sort of things in the works. So expect that to start contributing this year.

I think let me also sort of respond from a capital investment standpoint. We are going to be putting more capital in 2014 into our businesses that orient towards the mature fields strategy both the chemicals, artificial lift and expanding our footprint there both in North America and around the world and then continue to build out tools and other equipment to support what we see as a coming Brownfield opportunity in North America. Brad Handler - Jefferies & Company: That’s helpful. If I may, within that I think you identified -- within the Brownfield strategy, I think you identified a couple of offshore opportunities for example offshore Norway. Do you see those as progressing? On other words, is ICO spending in some meaningful way shifting to production enhancement? Is that generating some incremental opportunity for you as you tender today?

Yes, we see some of that though I would say it’s probably more focused with the national oil companies than it is the IOC. So it’s given kind of the type of investment profile I believe that they have. There are some offshore opportunities, but in terms of the kind of consolidated or we manage all of the activities, those types of things, those are less focused offshore and certainly more focused onshore.

Thank you. Our next question comes from of Doug Becker of Bank of America Merrill Lynch. Your line is now open. Doug Becker - Bank of America Merrill Lynch: Thanks. I want to clarify the North American revenue guidance a little bit. In the press release you mentioned mid single-digit growth, in the prepared remarks talking about spending in mid single-digits and that you generally outperform underlying spending. I just want to reconcile those comments for North American revenue growth?

Yes, this is Dave. Let me take that -- let me sort of attack it a couple of ways. One is that when we look at sort of what our customers are saying about spending in 2014, you sort of settle in the mid single-digit range. If you look at sort of where we believe the rate count is going, which is up a little, if you look at well count efficiencies which will be up in sort of the mid, maybe upper single-digits and then you can drive revenues sort of off of either of those. I think the important point is that we believe our revenue because of our position in North America it’s going to exceed whatever the market gives us. But we have -- all we can do at this point is gauge off what our customers are telling us they’re going to spend and what they say is sort of the mid single-digits. As I said we will beat that because of our position. We know the rate count will go up a little. We know that efficiency is going to be better. All of that bodes well for us, but we’re just trying to give you a number of data points by which you can then plug in your own growth expectations and then just add some on top of that for what you think will do. Doug Becker - Bank of America Merrill Lynch: So you wouldn’t be balking at say 7% to 9% revenue growth figure?

Doug Becker - Bank of America Merrill Lynch: Fair enough. Another one, I appreciate the difficulty in looking at Latin America growth for the full year. Are you able to give us some perspective of if there is a relief in Brazil, if the latest award or expected award actually starts ramping up in the second half. Are you able to just give some rough gauge about how big a deal those two instances could be for revenue and margins?

Yes.

Go ahead.

Yes, the -- not calling anything on the first half of the year, but if you look at the full year, those are meaningful projects in Mexico. So there is some upside in terms of growth for the full year, but we need to see those get started and work being done on those. But again we will know a lot more about this as we get further into the year.

The way I would probably also add to that is that as I think about the year, the revenue growth number is very difficult to pin. Clearly we talk about Brazil being lower, Mexico may have a late ramp in revenues, but what it does really make a difference in is for our margins, and -- we typically would like to talk about our international margins being in the upper teens and -- but Eastern Hemisphere is clearly on its way. I see some relief on the cost pressure of Brazil and Mexico activities beginning to solidify going forward. It gives us the opportunity to get our margins in Latin America back on track with the rest of the international markets and drive up in those upper teens.

Thank you. Our next question comes from David Anderson of JPMorgan. Your line is now open. David Anderson - JPMorgan: Thanks, good morning. I was wondering if you can just talk a little bit about the PEMEX mega tender a little bit. You said it was reduced from 10 down to 8. I’m just kind of curious what do you think the rationale was? Where those maybe the five ATG projects? I didn’t quite hear you on kind of how you articulated that.

Yes, initially there were 10 mega tender projects that were to be tendered. That number resulted in eight in the end and of those eight the reduction were in the ATG or Northern Mexico projects. Expectation is that’s on the back of really reform. The reform in Mexico is going to be net net, a very positive event for the service industry. But over the near-term there is a milestones and things that would appear will slowdown the investment or at least sort of the decisions around some more potentially over the near-term. So I think that was one of the drivers in terms of a smaller sort of scope overall. I think the total sort of expectation number there was around $3.5 billion which initially has been expected in the $9 billion to $10 billion kind of range. David Anderson - JPMorgan: Right. So now were the terms on -- how are the terms end up on these contracts compared to what you’re expecting? It sounds like they were worsen you were thinking. Is that fair -- because if I heard you right, it sounds like you’re really -- you are only expecting to win the Mesozoic contract, is that correct?

Now that’s correct. Now the terms were – the terms were consistent with what we expected to see. I think we were little surprised by some of the pricing that we saw. I got to think even that there were fewer contracts to go after and there were number of bidders in the bidding for the ATG projects, but pricing on those was significantly down and surprisingly down. And that was just one of those where we’ve -- that was not acceptable pricing for the type of projects that they are. David Anderson - JPMorgan: Got it. Now that Mesozoic is, just correct me if I'm wrong, that's essentially the extension of the Alliance 2 project. So you already have everything mobilized in-country, so it's just a question of that cost absorption. You don't have to ramp up in the country, correct?

No, we don't have to ramp up. It's not really an extension of the Alliance 2 project, but we have the people, the kit, all of the resources in-country. We'll need some rigs to work with us. But outside the rigs, we're ready to go.

I think David, this is David, think of it as we have the resources and people in-country. It's just that as South Alliance ramps down, those people will not have anything to do, that resource will not have anything to do for a period of time until the next contracts, Humapa and Mesozoic, ramp back up. So rather than do a massive layoff and cost reduction and have to turn around and hire the people straight back, we're just going to absorb the costs in the meantime. So we will not have to add very much incremental costs in terms of where we have been. It's just a way underutilized resource for a couple of quarter period of time.

Thank you. Our next question comes from Angie Sedita of UBS. Your line is now opened. Angie Sedita - UBS: Great. Good morning, guys.

Good morning, Angie. Angie Sedita - UBS: Hi. So could you talk a little bit about what you're seeing in pressure pumping as far as pricing? Clearly, you had contracts that were being renegotiated in Q4 and we're seeing a little bit of that in Q1. Do you think that pricing could continue to be under pressure into Q2? Have you actually seen an intensification of competition? One of your largest peers mentioned some market share gains, so can you talk about what you're seeing in the market?

We're seeing continued pricing pressure certainly in the market. And so as we go into looking at contracts and pricing, one of the first things we look at, are the customers where we can be the most efficient and execute our value proposition. But the market is clearly competitive.

I would also add, Angie, with respect to market share gains, it's not coming out of our hide, that's for sure. Yes, there is plenty of stacked equipment out there. There's a bit of flight to quality that goes on in this kind of market and even though pricing is challenged, as Jeff has said, and there is some market share shift going on, it's sure not coming out of ours.

I want to reiterate that the 200 basis points of margin improvement in North America for us is net of pricing. So while we assume that pricing will continue to be weak for us, we're working hard to make sure that that does not influence our margins negatively during the year. Angie Sedita - UBS: All right. Yes, I assumed as much that your market share would not be affected. I guess going to that point, Mark, on the 200 basis point gain in North America. Is that gain in margin weighted to the back half of the year given your mark for Q1? And are you able to quantify yet of that 200 basis points how much is from internal measures, the Battle Red and the Frac of the Future?

Well, it's not that I can't yet articulate how we're going to get there, but I don't know that I want to necessarily for public consumption. But it is our view that as we go through the year, the margins will stair-step higher across 2014. It's a cumulative 200 basis points of margin addition. And so we'll realize it as we get into the end of the third quarter which is typically our highest margin quarter. But it should stair-step higher in Q1 and Q2 as well on a year-over-year basis and sequentially. Angie Sedita - UBS: Okay. And then as a unrelated follow-up on the international markets, clearly 2013 was pretty impressive where you outpaced your peers on the revenue side and operating income. And I thought, Dave, you said you expect to see the same in 2014. Can you talk about where on a relative basis do you expect to outpace your peers? And is this a combination of market share and new technologies or greater market penetration of some markets?

I think, Angie, it's really all of the above. I don't want to highlight a certain region or that region all of a sudden gets a big target put on its back. But I would say generally, we're really pleased with where we are in terms of our Eastern Hemisphere market penetration contract win rate, introduction of new technology. So I would just leave it as it's – I'm pretty happy all the way across the board. Angie Sedita - UBS: Thank you.

Thank you. Our next question comes from James West of Barclays. Your line is now opened. James West - Barclays Capital: Hi. Good morning, guys.

Good morning, James. James West - Barclays Capital: Dave, a bigger picture question for you on North America. You talked about well efficiencies last year. I think you said 14% and you're expecting high single-digits this year. Where do you think we are in this cycle of well efficiencies and how much more do we have to go where the well count can really outpace the rig count, et cetera? It seems like we're starting to slow down on that.

I think clearly the low-hanging fruit has been picked. Right now, I don't see any reason why we will not continue to get year-over-year well count efficiencies. You're starting to see sort of a massive upgrade to the rig fleet that's out there. The move to pad drilling, obviously I think is one of the real drivers we saw last year in terms of the efficiency gains. But as I mentioned in my remarks, the Permian now is switching from what was really a vertical to a horizontal market and there are a lot of rigs running in the Permian right now. And I think that gives us confidence in driving the numbers for 2014 and even beyond that, because let's say the Permian's only at 50% at the end of 2014. That still leaves a pretty tremendous upside there. And there's other plays in the U.S. that are still moving toward more pad, more horizontal drilling. So I think just the nature of the transition of the market, the new technologies that not only Halliburton and the other service companies have, but the rig contractors are investing more in efficiency. So I don't really see an end to it at this point in time, but I think your big low hanging fruit's been picked at this point. James West - Barclays Capital: Okay, that's fair. And perhaps an unrelated follow-up on Brazil. I understand that you're negotiating with your major customer there about reducing your investment or your cost structure. What's the timing of when you might have some release on the heavier cost structure than you would have expected given the lack of contract size?

James, this estimate is very difficult to call at this point in time. We're working on a range of fronts to try to resolve it, talking with the customer and certainly what could be resolution but certainly not in the first half of the year. We don't expect to see that resolve.

Yes, I mean the service industry generally doesn't agree on all things all the time but I can tell you, this is one where both us and our peers are all in having the same discussion with Petrobras. We all really need relief at this point. James West - Barclays Capital: Sure. Okay, got it. Thanks guys.

Thank you. Our next question comes from Waqar Syed of Goldman Sachs. Your line is now opened. Waqar Syed - Goldman Sachs: Thank you. I just want to follow-up on James' questions about efficiency. What are you seeing in terms of efficiency on the pressure pumping side? Where are we in that improvement? It's been – the number of stages per day has been growing in a 24-hour time period. How do you see that trending in the coming years and where we are in that progress?

Waqar, we don't see that outpacing the improvement in drilling efficiently at least at this point in time. So the upshot is there's still more work to be done though we are improving certainly completion efficiency. The other dynamic in completion efficiency though are what we're doing with the completion. So reality is, we're seeing more stages but we're also seeing bigger stages and we're seeing the ability to do more things around the completion. So the concern around the completion outpacing the drilling is not necessarily a concern for us. Waqar Syed - Goldman Sachs: Okay. And then just one clarification. I just want to clarify, did you say that the margins in North America are likely to be higher or flat in the first quarter versus fourth quarter?

We expect to see those modestly higher…

Very modest. Waqar Syed - Goldman Sachs: Okay, great. Thank you.

Thank you. Our next question comes from Bill Herbert of Simmons & Company. Your line is now opened. Bill Herbert - Simmons & Company: Thanks. Good morning. With regard to your North America guidance in the first quarter, did I understand the flat prophecy for the quarter? Was that inclusive of an outlook for severe weather in the first quarter or did that exclude the prospect of weather in Q1?

Yes, that describe -- we described to you before as high stage count at the beginning of the quarter and then trailed off with the holidays and then a bit of the slow start to some key markets in January due to weather. But what we see is we call out of that is sort of an inverse in Q4. So I call those -- for those reasons about flat.

Yes, it is inclusive of weather. It’s just sort of assuming sort of a similar weather pattern to what we had in Q4. Bill Herbert - Simmons & Company: Okay. And then secondly did I hear you correctly Mark with regard to your Latin American margin roadmap for the second half of the year that we hoped to be in the upper teens realm in line with your other international margins by the second half or in the second half?

Well, hope it’s a -- yes that’s a strong word. Bill Herbert - Simmons & Company: Okay.

I mean that’s where I hope, but I -- right now I just have no ability to forecast thus getting there right now, given what we know on the revenue side. And the cost side, where we’ve talked -- we’ve described that we’re having to carry a significant amount of cost. We don’t have any relief for that cost right now and so we got to get that relief in order to sort of build the roadmap to get back to those upper teen. So yes, that is our hope that certainly what we’re going to continue to drive internally, but at this -- I don’t have it on our forecast right now just because of the uncertainty around cost recovery. Bill Herbert - Simmons & Company: Okay. Thank you.

Thank you. And at this time, I’d like to turn the call back to management for any closing comments.

Thank you, Sam. On behalf of Halliburton management team, I just want to thank everyone for your participation. And Sam you can go ahead and close the call.

Thank you, sir. Ladies and gentlemen, thank you for participating in today's conference. This does conclude today’s program. You may all disconnect. Everyone have a wonderful day.