Halliburton (HAL) has recently received a contract from Royal Dutch Shell (RDS.A) for delivering fluid services on one deepwater rig and one tension leg platform in the Gulf of Mexico. The contract includes delivering clay-free, high-performance fluid systems capable of handling deepwater challenges through improved control of downhole pressures and cold-temperature rheology. The contract size has not been disclosed.

Halliburton has gathered a couple of fluid services contracts in recent months, which will contribute significant revenue to its Drilling and Evaluation segment (accounted for 46% of total revenues in 2008). Last month, it received a $140 million contract from Total (TOT) for delivering fluid services for deepwater drilling and completion activities in offshore Angola.

In July, the company received a $190 million contract from Petrobras (PBR) for providing drilling fluid, completion fluid and drilling waste management services in offshore Brazil and a $450 million contract extension from StatoilHydro (STO) for providing fluids systems for multiple fields on the Norwegian continental shelf.

We view these contract awards as a positive for Halliburton amid the present challenging business environment. However, its overexposure to the North American pressure pumping market remains an area of concern due to a weak outlook. We maintain our Neutral recommendation for the company.
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