Globalization

There is a mini-tempest brewing over Halliburton's announcement that it will move its headquarters to Dubai, as chief executive officer Dave Lesar sets up an office there (although other key executives will remain in Houston to oversee operations in the Western Hemisphere). This decision is a wake-up call to the industry and to Washington. Like famed bank-robber Willie Sutton, Halliburton is going where the money is, and who can blame the company for that? It's another signal that the world oil game has changed. Drilling activity in the Eastern Hemisphere is on the upswing because that's where the reserves are-and a huge portion of growing oil production too. Russia, Azerbaijan, Kazakhstan and Angola will account for most of the increase in oil output from non-OPEC sources in the near term, says the International Energy Agency. In this hemisphere rest only two similarly significant growth areas: Brazil and the Canadian oil sands. Not surprisingly, the IEA's mid-term forecast calls for above-ground risks to exceed below-ground risks, with the biggest exposure being resource nationalism, ethnic violence, land access and fiscal uncertainties. For more on this, see the April issue of Oil and Gas Investor. For a subscription, call 713-260-6441.