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HSE&S 2010 Annual Report

Health, Safety, Environment and Security Annual Report

Message from the Vice President & Chief Security Officer, Health, Safety, Environment and Security (HSE&S)

I am pleased to present the 2010 report of Baker Hughes’ health, safety, environmental and security performance. Against the backdrop of organizational transition, and the integration of our HSE&S policies and systems, employees remained focused on working safely and minimizing impacts to the environment.

We can report continued success with our Baker Hughes HSE&S improvement goals. The downward trend in employee injury and illness cases continued for the 10th consecutive year, with the 2010 incident rates being the lowest reported in the company’s history. Concurrent with this is a reduction in injury severity for those incidents we were unable to prevent. Motor vehicle accidents were also reduced, compared with 2009. While the overall environmental goal was a challenge, we saw significant reductions in the consumption of natural gas, off-road diesel, propane and fuel oil by 10% or more. With these achievements, realized by energy conservation measures, as well as reduced spills and improved recycling, more than $9 million was saved last year. In addition, through operations support, by ensuring inherently safer design and delivery of more efficient HSE&S programs, cost avoidance across the function saved more than $12.5 million for Baker Hughes.

We are also very proud of the recognition that Baker Hughes achieved in corporate social responsibility (CSR) and environmental rankings, including industry-leading positions in the Newsweek Green Rankings and the Bloomberg-Maplecroft Climate Innovation Index, along with a top 10 slot in Computerworld’s Green-IT awards. These successes reflect the efforts of our global workforce, demonstrating that sustainability and environmental activities are very much a part of our day–to–day business.

Looking forward in 2011, we continue to strive for additional performance through initiatives that focus on “Safety on the Job.” For the Gulf of Mexico team, this will involve implementing standards and systems to comply with the new offshore safety regulations that followed the Macondo incident. Through greater focus on both occupational (personal) safety and process (system) safety, we expect to not only improve Baker Hughes ability to manage the “slips, trips and falls” type incidents but also recognize and intervene to eliminate systemic safety factors that present the potential for a more catastrophic event.

Sincerely,

Russell J. Cancilla

Vice President & Chief Security Officer
Health, Safety, Environment & Security
Baker Hughes Incorporated

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