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BJ Services Company
SunTrust Robinson Humphrey 31st Annual
Institutional ConferenceApril 16, 2002
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BJ Earnings Growth Strategy

• Expansion in international pressure pumping
  markets
• Expansion of products services which
  leverage off pressure pumping
• Operating efficiencies
• Optimize cyclical nature of business

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Record Revenue
Revenue (millions)
Rigs
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Record Revenue per Rig
Revenue (millions)
Revenue per Rig (000s)
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Record Earnings per Share
Excludes unusual and non-recurring charges
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Shareholder Scoreboard
Oil Drilling, Equipment Services
The Wall Street Journal February 25,2002

1 year 3 year avg 5
year avg 10 year avg Patterson-UTI
Energy -37.4 79.0 29.3 na BJ Services
Company -5.8 60.7 20.5 24.4 Weatherford
Intl -21.1 42.3 17.0 21.1 Nabors
Industries -42.0 36.5 12.3 18.6 Noble
Drilling -21.6 38.1 11.4 27.0 Schlumberger -30.3
11.3 5.5 8.8 Smith International -28.1 28.6 3.6
21.3 Baker Hughes -11.1 29.4 2.6 8.5 Diamond
O/S Drilling -22.9 10.4 2.6 na Transocean Sedco
Forex -26.2 8.4 1.9 na Cooper
Cameron -38.9 18.1 1.1 na Varco
International -31.1 22.6 -0.7 7.9 Tidewater -22.
4 15.6 -4.0 12.8 Halliburton -63.3 -22.8 -14.2 1
.7 GlobalSantaFe -10.6 25.9
na na Industry Group Avg. -30.3 26.7 4.8 15
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Geographic Expansion Focus
Russia(400mm)
Mexico(200 mm)
Central Asia (100 mm)
West Africa (350 mm)
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Product and Service Line Expansion

• International Stimulation
• Coiled Tubing Services
• Service and Completion Tools

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Coiled Tubing Services
Growing Applications Through Improved Technologies
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Coiled Tubing Revenue Growth
(millions)
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Revenue by Product Line
1990 Revenue - 350 million
2001 Revenue - 2.2 billion
Stimulation 46
Cementing 54
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Market Overlap
Pressure Pumping
Coiled Tubing

• Pumping
• Basic Services
• Advanced Services

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Acquisitions of Coiled Tubing Capacity
Company CT Revenue CT
Units Salvesen 9.5 million 13 SIAT 1.5
3 Western 2.5 4 Nowsco 67.5 75 Fracmaster 16.3 19
Preeminent 12.5 9 OSCA 10.9 12
Total 120.7 135
Revenue at the time of acquisition.
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Worldwide Coiled Tubing Units

• Units
  Capacity
• BJ Services 146 17
• Schlumberger 200 23
• Halliburton 100 11
• Superior 34 4
• Cudd 28 3
• OSCA 12 1
• Others combined 360 41
• Worldwide Total 880 100

Source Company Estimates
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Revenues - Market Distribution
Market Size - 1.1 billion
Schlumberger 37
Other 29
Halliburton 12
BJ Services 22
Source Company Estimates
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Coiled Tubing Conveyance mechanism for fluids
and/or tools
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• Innovations Driving Demand
• Bigger diameter coiled tubing
• More reliable coiled tubing
• Choice of reliable thru tubing re-entry
  tools technologies
• Recognition of damage arising
• from well killing operations
• Horizontal wells

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Coiled Tubing Services
Advanced Services - Horizontal Clean-outs -
Horizontal Logging - Horizontal perforating -
Concentric CT (Sand-vac) - Multi-lateral re-entry
(LEGS) - UHP Operations - Directional CT
Drilling - Underbalance Drilling - Fracing thru
CT
Basic Services - Gas Lifting - Sand Clean-outs -
Scale Removal - Acid Washing - Production
Strings - Fishing
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Customer Benefits

• Avoid killing the well (ie. thru tubing)
• Faster trip time than rig (especially valuable
  for deepwells and operations requiring multiple
  trips)
• Availability and speed of mobilization
• Exact placement of stimulation fluids
• Protects expensive tubulars from contact with
  acid
• Lower cost than a rig (offshore)
• Wide range of reliable thru tubing
  technologynow available

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Coiled Tubing Research Development
(millions)

• BJ Coiled Tubing Innovations
• Turbine driven jetting technology - ROTOJET
• Concentric coiled tubing - SAND-VAC
• Multi-lateral re-entry technology - LEGS
• Solids transport in deviated wells - TORNADO
• Multi-phase well-bore hydraulics model - CIRCA
• CT directional drilling tool suite
• Down-hole phase separator

patents granted or pending
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Revenue per Unit Growth
(s in thousands)
1,725
894

• Revenue per unit growth
• of 93 through
• Geographic redeployment
• Advanced technologies

Revenue per Unit at Acquisition Date
Revenue per Unit FY 2001
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Market Overlap
Pressure Pumping
Coiled Tubing
Completions

• Pumping
• Basic Services
• Advanced Services

• Pumping
• Completion Tools
• Completion Fluids

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Service Completion Tools Revenue
(in millions)
Estimated Market Size 1.1 Billion
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OSCA Acquisition
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OSCA Products / Services
2001 Revenue - 176 million
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Geographic Coverage
Fluids Tools Services Gulf of Mexico X X X Brazil
X X Venezuela X X Saudi Arabia X Mexico X U.K. X
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Strategic Benefits

• Broad offering of completion tools
• Premium completion fluids business
• International expansion opportunities
• Annual cost savings of 15 to 20 million
• Earnings and cash flow accretive in 2003

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BJ Earnings Growth Strategy

• Operating efficiencies
• Optimize cyclical nature of business

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Operating Efficiencies

• Labor Efficiencies
• Overhead Efficiencies

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Revenue per Employee
(in 000s)
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Overhead Cost - of Revenue
(GA / Marketing)
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1998 - 1999 Down Cycle

• Overhead Restructuring
• Share Repurchases
• Fracmaster Acquisition
• Continued Intl / Product Line Expansion

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2001 versus Prior Cycle Peak
(s in millions except per share amounts)
LTM 2001 6/30/98 Change Revenue
2,234 1,590 41 Average Rigs
2,272 2,132 6.6 Gross Margins
714 403 77 Revenue 32.0
25.3 6.7 Operating Income 536
252 113 Revenue 24.0 15.8
8.2 Earnings per Share 2.09
0.95 120 Cash Flow per Share
2.72 1.49 83 Incremental Operating
Income 44
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2001 - 2002 Down Cycle

• Share Repurchases - 278 million
• OSCA Acquisition - 420 million
• U.S. Fracturing Fleet Recapitalization
• International Expansion - West Africa
  - Russia - Mexico
• Pending Niche Acquisitions

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Increased Peak Earnings Leverage
(Unlevered)
Share Repurchases 0.17 OSCA 0.25 -
0.40 Fleet Recapitalization 0.05 -
0.06 International Expansion 0.08 -
0.10 Estimated Increased Earnings
Capacity 0.55 - 0.73
Prior Peak Earnings Run Rate 2.40 Increased
Earnings Leverage 23 - 30
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Continued Financial Strength
Projected Debt / Capitalization(pro-forma for
OSCA acquisition)
Based on current First Call earnings estimates,
adjusted for OSCA acquisition
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BJ Services Company
SunTrust Robinson Humphrey 31st Annual
Institutional ConferenceApril 16, 2002
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(No Transcript)
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Return on Capital Employed
Excludes unusual and non-recurring charges