Venezuela devaluation to cost Halliburton $30M

Halliburton said it will take $30 million charge in 1Q related to Venezuelan devaluation

Associated Press

NEW YORK (AP) -- Halliburton Co., the world's second-largest oilfield services, said it will take a $30 million charge related to Venezuela devaluing its currency.

In a filing with the Securities and Exchange Commission on Monday, Halliburton, which is a major provider of the pressure-pumping technique known as hydraulic fracturing, or "fracking," said it will take a foreign currency loss in the first quarter. The devaluation does not affect 2012 results.

Venezuela, a country heavily reliant on imports, announced Friday that it would devalue the bolivar. The country relies on dollar-denominated oil sales and the government hopes to ease the amount of money that it must borrow to continue functioning.

The government initiated stringent currency exchange controls in 2003. People and businesses must apply to a government currency agency to receive dollars at the official rate, but a black market on currency is flourishing. The bolivar on that market began falling some time ago.

The value is now expected to be 6.3 bolivar to the dollar, from 4.3 to the dollar. President Hugo Chavez has remained out of sight in Cuba recovering from cancer surgery.

As of Dec. 31, Halliburton's total net investment in Venezuela was $328 million, including $74 million in monetary assets in bolivar.

Further devaluation of the bolivar could also impact operations, the Houston-based company said.

Analysts surveyed by FactSet expected Halliburton would report earnings of 58 cents per share on revenue of $6.9 billion for the first quarter.

Halliburton shares fell 41 cents to $40.85 in afternoon trading Monday after rising earlier to a high of $41.44, its highest since August 2011.

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