Cooper Cameron Corporation is an international manufacturer of oil and gas pressure control equipment. In 1999, revenues were $1.46 billion, down 22% from 1998 due to declining orders from customers in the weak market. Net income was $43 million. Several plants were closed and about 1,000 employees were reduced through layoffs and attrition to control costs in the difficult market conditions. The rotating compressor business was sold to improve focus on reciprocating engines and compressors. Cash from the sale enhanced Cooper Cameron's financial flexibility with $210 million of debt and a debt-to-capitalization ratio of 22.8%.

1. 1999 ANNUAL REPORT

2. Cooper Cameron is a leading international
manufacturer of oil and gas pressure control
equipment, including valves, wellheads, controls,
chokes, blowout preventers and assembled
systems for oil and gas drilling, production and
transmission used in onshore, offshore and
subsea applications. Cooper Cameron is also a
leading manufacturer of gas turbines, centrifugal
compressors, integral and separable reciprocating
engines, compressors and turbochargers.
Additional information about the Company is available on Cooper Cameron’s
home page on the World Wide Web at www.coopercameron.com.

3. Financial Highlights
($ thousands except per share, number of shares and employees)
Years ended December 31: 1999 1998 1997
Revenues $ 1,464,760 $ 1,882,111 $ 1,806,109
Gross margin 398,785 552,589 509,162
Earnings before interest, taxes,
depreciation and amortization (EBITDA)1 193,051 322,879 293,831
Net income 43,002 136,156 140,582
Earnings per share
Basic 0.81 2.58 2.70
Diluted 0.78 2.48 2.53
Diluted (Excludes nonrecurring/unusual charges (credits)) 1.00 2.76 2.53
Shares utilized in calculation of earnings per share
Basic 53,328,000 52,857,000 52,145,000
Diluted 54,848,000 54,902,000 55,606,000
Capital expenditures 64,909 115,469 72,297
Return on average common equity 5.8% 19.1% 24.3%
As of December 31:
Total assets $ 1,470,719 $ 1,823,603 $ 1,643,230
Total debt 210,332 413,962 376,955
Total debt-to-capitalization 22.8% 34.7% 37.0%
Stockholders’ equity 714,078 780,285 642,051
Shares outstanding 50,567,959 53,259,620 52,758,143
Net book value per share 14.12 14.65 12.17
Number of employees 7,200 9,300 9,600
Excludes nonrecurring/unusual charges (credits).
1
TABLE OF CONTENTS
Company Profile . . . . . . . . . . . . . . . . . . . . . . . . . 2
Letter to Stockholders . . . . . . . . . . . . . . . . . . . . 4
Cameron . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Cooper Cameron Valves . . . . . . . . . . . . . . . . . . . 14
Cooper Energy Services . . . . . . . . . . . . . . . . . . . 18
Cooper Turbocompressor . . . . . . . . . . . . . . . . . . 22
Management’s Discussion and Analysis . . . . . . . 25
Report of Independent Auditors . . . . . . . . . . . . 34
Consolidated Financial Statements . . . . . . . . . . . 35
Notes to Consolidated Financial Statements . . . 39
Selected Financial Data . . . . . . . . . . . . . . . . . . . 55
Stockholder Information . . . . . . . . . . . . . . . . . . 56
On the cover: Cameron’s SpoolTreeTM Production System
1

4. Company Profile
®
PRODUCTS CUSTOMERS
Gate valves, actuators, chokes,
Provides pressure control Oil and gas majors,
wellheads, surface and subsea
equipment for oil and gas independent producers, for- ® ®
production systems, blowout
drilling and production in eign producers, engineering
preventers, drilling and
onshore, offshore and subsea and construction companies, ®
®
production control systems,
applications. drilling contractors, rental
drilling and production companies and geothermal
riser and aftermarket parts energy producers.
and services.
®
PRODUCTS CUSTOMERS
Gate valves, ball valves,
Provides products and Oil and gas majors,
butterfly valves, Orbit valves, ®
services to the gas and independent producers,
rotary process valves, block &
liquids pipelines, oil and foreign producers, engineering
bleed valves, plug valves,
gas production and ®
and construction companies, ®
actuators, chokes, and after-
industrial process markets. pipeline operators, drilling
market parts and services. contractors and major ®
chemical, petrochemical
and refining companies.
PRODUCTS CUSTOMERS
Engines, integral engine- Oil and gas majors,
Provides products and
compressors, reciprocating independent producers,
services to the oil and gas
compressors, turbochargers, gas transmission companies,
production, gas transmission,
control systems and after- equipment leasing companies
process and power

market parts and services. and independent power
generation markets.
producers.
PRODUCTS CUSTOMERS
Integrally geared centrifugal Durable goods manufacturers,
Manufactures and services ®
compressors, compressor sys- basic resource, utility, air
centrifugal air compression
tems and controls. Complete separation and chemical
equipment for manufacturing
aftermarket services including process companies. Specific
and process applications.
spare parts, technical services, focus on textile, electronic,
repairs, overhauls and com- food, container, pharmaceutical
pressor upgrade engineering. and other companies that
require oil-free compressed air.
2

5. Cooper Cameron Corporation
has sales, manufacturing, service
and distribution facilities in strategic
locations around the world.
3

6. taking advantage of opportunities in the
coming recovery.
To the Stockholders of Cooper Cameron Downsizing necessary to respond
to market
At the beginning of 1999, our employ-
This was a difficult year. It began with extremely low oil
ment totaled approximately 9,300, down from
prices, economic uncertainty in Southeast Asia and concern about a peak of nearly 10,400 in early 1998.
Declining revenues, lower utilization and
the global market environment. Our orders and backlog had
plant consolidations triggered additional
begun to decline during the last half of 1998, and the weakness in reductions during the year, and nearly 1,000
our customers’ spending and activity levels continued throughout people moved to Rolls-Royce plc as a result of
the sale of our rotating compressor business.
1999. Even though crude oil prices were bolstered earlier in the By the end of 1999, through layoffs, retire-
year by a combination of worldwide economic stabilization and ments, attrition and the sale, we had reduced
staffing by more than twenty percent. Our
agreement between OPEC and non-OPEC energy producers on
employment level at year-end–approximately
lower production levels, the damage to our customers was done. 7,200–was below that of the end of 1995, our
first year as a public company.
Most of them have been hesitant, or in some cases fiscally unable,
Plant closures address capacity, cost struc-
to resume the spending pace of only a couple of years ago. ture—In early 1999, we completed the clos-
ing of a Cooper Cameron Valves (CCV) plant
In this letter last year, we discussed the need to manage our
near Houston, Texas, and moved the opera-
costs effectively, so as to ensure that we would comfortably tions to facilities in Oklahoma City.
Cameron’s Vienna, Austria plant was closed
survive any downturn in our business. We also said we needed to be
in the third quarter of 1999, and its manu-
mindful of being even better prepared to take advantage facturing load was transferred to other
European facilities. We have initiated the
of the inevitable recovery when it arrived. We have done both.
closing of Cooper Energy Services’ (CES)
Grove City, Pennsylvania facility, which
should be completed by the second quarter of
2000, and the castings and parts previously
Financial performance
provided by this facility will be purchased
in a trying environment
from outside suppliers or produced at other
Revenues totaled $1.46 billion in 1999, locations. Certain CES facilities in Mount
down about 22 percent from 1998’s $1.88 bil- Vernon, Ohio—separate from those con-
lion. Earnings before interest, taxes, depreci- veyed to Rolls-Royce in the sale of the rotat-
ation and amortization (EBITDA) fell by 40 ing business—are being closed and their
percent, to $193 million compared with last operations will be transferred to Cooper
year’s $323 million. Earnings per share, Cameron locations in Oklahoma and Texas.
excluding nonrecurring items, totaled $1.00 All of the above actions reflect not only softer
for the year, down 64 percent from 1998. The markets and declining orders in these busi-
good news? We posted these results in a mar- nesses, but also opportunities to generate
ket where many of the companies in our continuing cost savings.
industry lost money or struggled to remain
Sale of rotating business
modestly in the black. This performance
provides multiple benefits
reflects the benefit of having a backlog of busi-
At the end of the third quarter, we closed
ness and is a tribute to our employees’ ability
on the sale of the CES rotating, or centrifugal,
to take decisive action to deal with tough
compressor business to our long-time joint
issues. We expect to be just as resourceful in
4

7. venture partner, Rolls-Royce plc, for approx- debt level. At year-end, after using approxi-
imately $200 million. Our difficulties in the mately $92 million to repurchase our stock
rotating market stemmed from the fact that we under the bank transactions described below,
did not control the key technology of the busi- we had only $210 million of debt, with a debt-
ness (the engine, which Rolls-Royce provides). to-capitalization ratio at less than 23 percent.
We competed in a relatively narrow, highly Beginning in early 1998, two of our banks
$1,882
$1,806
competitive market niche and had limited periodically bought Cooper Cameron com-
$1,465
opportunity for aftermarket parts and service mon stock in the market under a forward
$1,388
as a manufacturer solely of power turbines purchase agreement and held it for us. Under
$1,144
and compressor units. We expect that Rolls- the agreement, we had the right to buy the stock
Royce will be able to leverage its worldwide from them at the price they paid in the market,
exposure and full ownership of these facilities plus a fee. During December 1999, we bought
into improved profitability and utilization. from the banks all 3.5 million shares that had
They were excellent partners, and we wish been purchased to date and added those to our
them well. treasury stock. The shares were acquired at an
95 96 97 98 99
CES’ resources will now be devoted to the average price of about $28, including fees. The
Revenues
manufacture, sale and servicing of recipro- immediate impact is a reduction in the total
($ millions)
cating engines and compressors, which are shares outstanding, and therefore an effective
used primarily in natural gas markets. We are increase in the earnings per share that will be
encouraged by the impact to date of the cost- reported in subsequent periods. We expect to
saving steps that have already been initiated gradually reissue the shares in the future for
$323
within the CES organization, the potential internal needs, such as compensation pro-
$294
that exists in an improving North American grams, and we also retain the ability to repur-
gas market and the opportunity to build on chase shares in the market. Our preference at
$193
CES’ role as a supplier to equipment leasing this time is to keep our actual share count very
$183
companies. Another benefit is the flexibility near the fifty million shares (adjusted for
that the cash proceeds from the sale added to the 1997 split) that were outstanding upon our
$81
our financial position. creation in 1995. Our total authorization for
CES’ transformation to meaningful prof- repurchase is ten million shares, or nearly
itability is by no means complete. There are twenty percent of the shares outstanding.
95 96 97 98 99 still issues related to cost structure, product Acquisitions remain a priority for us.
EBITDA lines and aftermarket exposure that we will Although we made only one during 1999—
($ millions)
address in the coming months. The ongoing buying out the interest of our joint venture
relocation of facilities under the terms of the partner in Venezuela—our assessment process
agreement with Rolls-Royce is a significant remains active. At any time, we are likely to be
part of that process, but should be completed reviewing two or three candidates for addi-
by the end of this year. tion to the Cooper Cameron portfolio. Our
criteria remain the same as always: we prefer
Financial flexibility, business
businesses we already know well; private firms
options enhanced
We have taken great can usually be acquired without paying the
During this market cycle, we have taken
pains to ensure that our market premium inherent in buying public
great pains to ensure that our balance sheet
balance sheet remains companies; regional players usually offer the
remains in solid condition. The cash infusion
in solid condition. chance to develop or expand a meaningful
from the rotating sale further enhances our market share position; and we like the mar-
financial flexibility and expands our options gins and long-term nature of aftermarket
for improving performance as the industry businesses. Our current financial position
recovers. Even as orders and profits declined, will allow us the luxury of considering
the cash generation capability of our busi- numerous possibilities that meet all or most
nesses has enabled us to achieve a very low of these standards.
5

8. Incentives for innovation world, the actions described above have kept
17.2%
16.3% our revenue-generating capacity at least at the
For years, Cooper Cameron’s businesses
levels we saw in the robust markets of late 1997.
13.2%
13.2%
have been among the leaders in developing
We believe we have seen the trough in the
new products and processes for their indus-
recent cycle; now, we are anxious to see how
tries. Since Cooper Cameron’s formation in
7.1%
much better we can do when given the chance
1995, we have placed greater emphasis on the
to again perform in a strengthening market.
translation of ideas into patents. As a result,
intellectual property activity has increased Management changes
significantly, both in alliances with other com-
A couple of changes in our management
panies and through internal programs. Our
95 96 97 98 99
team deserve mention.
employees can earn incentive awards for the
EBITDA
William C. Lemmer joined us in July as
(as a Percent of Revenues)
successful development of patentable concepts
vice president, general counsel and secretary
that contribute to revenues and profitability,
80
of Cooper Cameron Corporation, responsible
or that can be licensed to the industry. The
for all legal matters with respect to Cooper
number of Cooper Cameron patent applica-
Cameron and its subsidiaries. Bill previously
tions has increased significantly since 1995-96;
held similar positions with Oryx Energy
filings during 1999 were more than double
Company and with Sunoco, Inc. His diverse
those of recent years.
31
experience in the energy business makes him
24
26
Protecting the intellectual property assets
a valuable addition to our senior management
inherent in many of our proprietary core tech-
14
team. Bill replaced Franklin Myers, who con-
nologies and business methods is important to
tinued to serve as corporate general counsel
improving competitive position and product
even after he was named president of our
95 96 97 98 99
margins. The SpoolTreeTM Production System
Cooper Energy Services division in August
Patent Applications Filed
is one example of an innovative solution that
1998. Franklin’s full attention is now devoted
became a Cameron patent and is now an
$115
to managing the day-to-day CES operations.
accepted application for subsea completions.
E. Fred Minter has announced his retire-
Licensing revenues from such technical
ment from Cooper Turbocompressor (CTC)
innovations are expected to increase in
after 42 years with CTC and its predecessors.
$72
coming years.
$65
Under Fred’s leadership as president, CTC has
Prepared for the recovery been a top performer in the industry and in
$40
$37
the Cooper Cameron family. His successor,
In the rising markets of 1997-98, we began
Robert J. Rajeski, became president of CTC in
allocating capital to upgrade manufacturing
August, and Fred has served in an advisory and
plants to accommodate customers’ needs for
consulting role since then. His forthright
quicker delivery. We followed through with
95 96 97 98 99 manner and steady hand will be missed; we are
those plans, even as orders and backlog were
Capital Expenditures grateful for his exemplary service and we wish
declining. Over the past three years, two-thirds
($ millions)
him a long and rewarding retirement.
of our spending has been directed toward
improving Cameron’s facilities. Newer, faster, Entering the next cycle
We anticipate that this
more efficient machines have lowered our costs
new equipment will give Like us, our customers have taken signif-
in the downturn of the business cycle. More
us greater manufacturing icant steps to deal with adversity and prepare
importantly, we anticipate that this new equip-
capacity at lower cost for recovery. Most of them have struggled
ment will give us greater manufacturing capac-
through this latest down cycle in our busi-
when activity recovers.
ity at lower cost when activity recovers. That
ness, and are at least as eager as we for times
That should translate into
should translate into higher profit margins,
to improve. Once their cash flows have stabi-
higher profit margins, better on-time delivery performance, and
lized and their project economics justify rein-
better on-time delivery greater customer satisfaction.
vestment, increased activity and spending will
performance, and greater The bottom line? While we’ve closed or
drive improving returns for those of us in the
customer satisfaction. consolidated several facilities around the
6

9. $1,894
$1,843
$1,497
$1,303
$1,260
95 96 97 98 99
Orders
($ millions)
$790
$786
$728
$588
$513
service and equipment businesses. We’ve done again dealing with the challenges of finding
our best to maintain our relationships with and adding more top performers, as opposed
customers during difficult periods. I think to the difficult task of reducing the workforce
95 96 97 98 99 those relationships will be a huge part of our because a lack of activity demands it.
success over the next couple of years. Let’s hope that the current environment
Backlog
(at year-end, $ millions)
Much of that success will be driven by develops into the wealth of opportunity that
the apparent growth in worldwide deepwater forecasters are touting, and that we can cap-
development. Significant opportunities exist ture the opportunity—and distribute the
for our subsea business to rebuild backlog as resulting financial rewards—among all of our
new orders are placed for production equip- constituencies.
We’ve done our best to ment on large-scale offshore projects in areas
maintain our relationships like West Africa, Brazil and the Gulf of Mexico.
Plaudits about the importance of people
with customers during
to our business bear little credibility with those
difficult periods. I think Sincerely,
who have been downsized, outsourced or oth-
those relationships will
erwise released from their jobs. But the harsh
be a huge part of our
reality is that energy markets are inherently
success over the next
cyclical, and no company can avoid the need
couple of years.
to constantly adjust employment—up or Sheldon R. Erikson
down—as the market dictates. The people Chairman of the Board,
who work for Cooper Cameron are among President and Chief Executive Officer
the best in their fields; we look forward to
7

10. The Cameron SpoolTreeTM Production System
is one of the most widely used subsea trees
in the world and offers many time- and
cost-saving advantages over conventional
tree systems.
8

11. 19 S TAT I S T I C A L / O P E R AT I N G
99 HIGHLIGHTS
($ millions) 1999 1998 1997
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $811.2 $1,021.1 $874.7
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139.3 215.0 160.5
1
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.8 82.0 47.1
Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 619.5 1,074.9 1,033.9
Backlog (as of year-end) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367.0 592.6 515.9
Excludes nonrecurring/unusual charges.
1
Cameron is one of the world's leading providers of equipment used to control
pressures and direct flows of oil and gas wells. Products include
wellheads, Christmas trees, controls, chokes, blowout preventers
and assembled systems, employed in a wide variety of operating
environments—basic onshore fields, highly complex onshore and
offshore environments, deepwater subsea applications and ultra-high
temperature geothermal operations.
$1,021
$1,075
$593
$1,034
$215
$516
$875
$811
$161
$139
$367
$620
97 98 99
97 98 99
97 98 99 97 98 99
Orders
EBITDA
Revenues Backlog
($ millions)
($ millions)
($ millions) (at year-end, $ millions)
9

12. Financial overview Drilling tinuing through 1999, a backlog of
orders linked to rig upgrades and new-
Cameron’s revenues declined to Cameron provides surface and
build construction drove continued
$811.2 million in 1999, down 21 percent subsea blowout preventer (BOP)
increases in Cameron’s drilling-related
from $1.0 billion in 1998. EBITDA stacks, drilling riser, drilling valves and
revenues. Cameron completed 18 large
(excluding nonrecurring charges) was choke and kill manifolds, as well as
bore 18 3/4″ subsea BOP stacks in 1999,
35 percent below year-ago levels, falling hydraulic and multiplexed electro-
an all-time high for annual shipments
to $139.3 million from 1998’s $215.0 hydraulic control systems used to oper-
and revenue for this product segment.
million. EBITDA as a percent of rev- ate BOP stacks, to multiple customers
Cameron’s focus on being a pri-
enues was 17.2 percent, down from in the drilling business worldwide.
mary supplier to new offshore drilling
21.1 percent. While revenues declined Cameron also provides complete after-
units built during the latest cycle, begin-
sequentially throughout the year, market services under the CAM-
ning in 1996, resulted in the completion
Cameron’s incoming orders appeared SERVE™ name and replacement parts
of 35 BOP stacks and 27 control systems
to bottom in the second and third for drilling equipment, including elas-
(excluding upgrades) for the new fleet of
quarters, and recovered modestly in the tomer products specifically designed
jackups, semisubmersibles, and drill-
fourth quarter of 1999. for drilling applications and manufac-
ships. As a result, Cameron holds a lead-
tured at Cameron’s state-of-the-art
New vice president and ing market share position in the delivery
Elastomer Technology facility.
general manager named of BOPs and control systems and
Although the drilling and explo-
recently established a world record with
In July 1999, Jack B. Moore joined ration market experienced reduced
an installation in 9,000 feet of water.
the Company as vice president and orders, consistent with the completion
Revenues for the drilling business
general manager, Western Hemisphere of the current new-rig building cycle
will decline in 2000, reflecting comple-
for Cameron. Moore previously spent during the latter part of 1998 and con-
23 years with Baker Hughes, where he
held numerous marketing and manu-
facturing management positions dur-
Cameron Subsea BOP Stack Systems incorporate
ing his tenure there.
the newest technology required by the demands
R&D, innovation fuel of deepwater and ultra-deepwater drilling.
technology leadership Cameron engineers have tackled
the tough challenges of
Cameron’s reputation as a tech-
deepwater by suc-
nology leader in the oil and gas indus-
cessfully evaluating
try reflects a longstanding commitment
deepwater criteria.
to research and development efforts,
often as a result of ideas generated
while looking for new solutions to
customers’ problems.
Cameron’s research and develop-
ment staff just completed its first full
year in its new 53,000-square foot
Research Center in Houston, Texas.
This facility—unmatched in the indus-
try—houses a state-of-the-art test lab
with a wide variety of testing and sim-
ulation capabilities and serves as the
base for the Company’s ongoing engi-
neering and design efforts. Each of
Cameron’s product line groups has a
dedicated R&D staff responsible for
keeping pace with industry and market
developments.
10

13. CSW saves customers money
tion of the current building cycle, and During the past year, Cameron customers in the Asia Pacific and
are expected to be well below the record Middle East (APME) region were looking for ways to reduce drilling and
levels experienced in 1999. Still, there
completion costs. Several of these customers were introduced to Cameron’s
are four subsea BOP stacks in the year-
Conductor Sharing Wellhead (CSW™) system, which allows two or more
end backlog scheduled for delivery in
wells to be completed within a single conductor (the large-diameter
2000, and it appears that customers may
place orders for several more of these casing at the top of a wellbore).
systems during the year. Cameron will
This departure from the conventional standard of one well per
continue its emphasis on providing the
conductor offers numerous benefits. In addition to cutting the number of
best value drilling systems available, and
conductors by at least half, installation time is lessened, platform size (on
maintaining its core competencies in
this market, while taking steps to reduce offshore locations) is reduced and the customer is able to maximize the use
costs in line with revenues. of existing slots. Meanwhile, drilling and completion activity on the wells
The impact of several new prod-
within the conductor are independent of each other, so operational flexi-
ucts and product enhancements intro-
bility is maintained.
duced in 1999 will continue in 2000.
Cameron’s Freestanding Drilling Riser, While the CSW system has been successfully installed in a number of
1999 winner of the Petroleum Engineer locations around the world, acceptance and application in the APME region
International Special Meritorious
was particularly impressive during 1999, with approximately 40 CSW
Award for Engineering Innovation, will
wellhead systems sold to a number of Cameron’s customers.
be a featured product along with sev-
eral other new system approaches that
allow safer, more cost-effective drilling
in deep and ultra-deep waters.
ture, Cavensa, from the Sivensa Group well subsea development. First oil from
in November. Cavensa is the largest this North Sea field is planned for the
Surface
supplier of surface valves to PDVSA, fourth quarter of 2000. The equipment
Surface equipment represents the
the Venezuelan national oil company. design is being guided by the
largest component of Cameron’s rev-
MOSAIC™ system, Cameron’s field-
enue base, and includes wellheads, Subsea
proven building block approach for
Christmas trees and chokes used on land
Subsea equipment includes prod- subsea equipment.
or installed on offshore platforms.
ucts and services associated with Another significant milestone for
Cameron holds the leading market posi-
underwater drilling and production Cameron is the Shell Malampaya
tion in supplying this type of equipment.
applications, including subsea well- Natural Gas Project, an offshore devel-
While oil prices posted an impres-
heads, modular Christmas trees, opment in the Philippines that will fuel
sive recovery during the year, the mar-
chokes, manifolds, flow bases, control three land-based power stations pro-
ket for surface products remained
systems, and pipeline connection sys- viding more than a third of the country’s
depressed through the end of 1999.
tems. The subsea market is another power requirements. Cameron’s scope
Major operators curtailed drilling and
area in which Cameron holds a leading of supply includes subsea wellheads,
production spending, especially on oil-
share of the installed base worldwide modular SpoolTrees, chokes, manifolds,
related prospects, and independents
and is one of the primary providers to flow bases, control systems, and pipeline
were slow to reinstate their activity,
the industry. connection systems. Selected compo-
partly due to the financial constraints
Highlights of Cameron’s business nents have already been delivered, with
created by low oil and gas prices.
in this market during 1999 included the balance to follow during 2000.
Assuming energy prices remain at or
the award and commencement of the Cameron’s production controls
near recent levels, surface well comple-
Texaco Captain subsea development. system,CAMTROLTM, has passed initial
tions should increase markedly during
Cameron’s scope of work includes the testing and will be integrated with the
2000, resulting in a recovery in pro-
unitized template manifold (U.T.M) in remainder of the subsea equipment at
duction equipment spending.
a joint venture with Brown & Root, Cameron’s Singapore plant. Cameron’s
Cameron expanded its market
Christmas trees, wellheads and multi- work, consistent with the project as a
presence in South America with the
plex production controls for this 15- whole, is on time and on budget.
acquisition of its Venezuelan joint ven-
11

14. Shell Expro Shearwater provides “large-scale” evidence
of Cameron’s capabilities
Cameron’s new CAMTROL production
Shell Expro’s Shearwater field in the North Sea is a high-pressure,
control system and increased penetration
high-temperature (HP/HT) development, estimated to contain 160 million
of evolving ultra-deepwater markets,
barrels of condensate and 850 billion cubic feet of gas. Total development
especially in West Africa.
costs are expected to approach $1.4 billion, and the facilities are designed
Cameron Controls
to handle peak daily production rates of 82,000 barrels of condensate and
Although Cameron Controls was
425 million cubic feet of gas.
organized as a separate business unit
Production is scheduled to begin in June. While the field life is expected
only three years ago, Cameron has been
to be 12 years, the production facilities will serve as the base for future in the controls business since the late
1970s. Drawing on a long history of
additions to capacity and are slated to operate for the next 30 years.
research and field experience, the
Cameron was selected to design and build the world’s first 63/8″, 15,000
Cameron Controls organization was
psi surface Christmas trees for the six initial wells at Shearwater. Cameron
formed to design, manufacture and
is also providing the associated wellhead and casing support systems. service drilling and production control
By September 1999, all of the Cameron equipment had been success- systems worldwide.
Its early growth was fueled by
fully installed, with no material installation or operating problems. In
orders for multiplexed (MUX) subsea
addition, the overall project was ahead of schedule and under budget.
drilling controls, combining Cameron’s
Cameron’s performance in the design, testing and installation of these reliable hydraulics with electronic tech-
critical components was recognized with three of Shell Expro’s prestigious nology to provide the rapid actuation
needed for BOPs in deepwater drilling
“Gold” awards. Cameron is proud to have played such a major role in the
applications. Entry into the subsea
continuing success of one of its major customers.
production controls market with the
state-of-the-art CAMTROL system was
a logical extension of Cameron’s
drilling controls success.
Other contractors in the Asia- subsea components such as Christmas
Cameron Controls’ role as a
Pacific region are jointly developing trees and wellheads declined significantly
world-class supplier is confirmed by its
the infrastructure needed to sustain in 1999, owing to the effects of low oil
current position as the leading supplier
similar projects. The regional outlook prices in 1998. Both Gulf of Mexico and
of MUX control systems to the drilling
for subsea projects in the future is North Sea shipments declined compared
market. Also, delivery has begun on
encouraging, and Cameron’s local to 1998 in line with reduced expenditures
Cameron Controls’ first MUX produc-
capability will be a key factor in cap- by key customers in the United Kingdom
tion control systems in the North Sea on
turing future business. and the United States. Deliveries will
the Captain project, to be followed later
During 1999, Cameron’s techno- increase in 2000, however, with the recov-
in 2000 by the installation of similar
logical leadership in offshore applications ery in drilling and production activity and
systems on the Malampaya project.
was confirmed through its introduction with the completion of large subsea orders
Cameron Controls’ two primary
of two more leading-edge applications entered into in 1998 and 1999 such as
manufacturing, assembly and testing
for ultra-deep water and high-pressure Shell Malampaya and Texaco Captain.
facilities,in Celle,Germany and Houston,
installations. Cameron delivered the During 1999, Cameron increased
Texas,saw their first full year of operation
world’s first 2,500-meter depth subsea its capability to engineer system solu-
in 1999. As expected, the new facilities
tree for use offshore Brazil, and the tions for subsea developments, leverag-
have reduced lead times, increased on-
world’s first 15,000-psi working pressure ing earlier development of modular
time deliveries and improved the effective
subsea tree was successfully deployed in elements for subsea systems (MOSAIC).
manufacturing capacity, while the loca-
the Gyrfalcon field in the Gulf of Mexico. Under this initiative, common elements
tions of the two facilities allow Cameron
Subsea equipment typically involves of subsea systems have been pre-engi-
Controls to conveniently serve and sup-
a longer lead time between order place- neered to permit ready reconfiguration
port markets worldwide, including West
ment and order completion and equip- to meet specific field needs.
Africa,the North Sea,South America and
ment installation than surface equipment. Subsea initiatives in 2000 will focus
the Gulf of Mexico.
Accordingly, Cameron’s deliveries of key on broadening of the customer base for
12

15. Cameron Controls expects to fits have been realized in raw materials share of Cameron’s revenues to more
exploit opportunities in the controls purchases, inventory reduction and than one-third.
market in three primary areas during overall operating expenses, and Cameron took steps to enhance its
2000. Continued product development Longford now accounts for half of the market presence in several locations
in subsea production controls, bol- Cameron Willis shipments. worldwide. In addition to buying out
stered by the successful installation of Gate valve actuator product the Company’s joint venture partner in
the projects described above, will rationalization and manufacturing Venezuela, consolidating Cameron’s
strengthen and expand the Company’s consolidation, a process completed presence in that country, a new joint
market position and product offerings. during 1999, will result in lower man- venture facility in Saudi Arabia was
The drilling controls focus will be on ufacturing costs in 2000. Other oppor- announced. Construction of the Saudi
maintaining Cameron’s leading mar- tunities include the marketing of facility will be completed by the end of
ket position, attained as a result of pro- Surface Safety Systems that control sur- 2000 and will expand Cameron’s after-
viding reliable, cost-effective systems face actuated gate valves and Christmas market capabilities in the Middle East.
for the BOP market, and on enhancing trees supplied by Cameron. Efforts will continue to grow the after-
that position by further improving the Cameron Willis will continue to market business through acquisitions,
product selection. As a logical exten- serve the offshore markets as projects increased penetration of existing mar-
sion of the above, aftermarket capabil- continue to be developed in deeper kets and identification of new markets
ities will be expanded in order to water, and benefit from an ever- that can be served by Cameron’s extensive
support the growing number of con- increasing aftermarket business for worldwide facilities.
trols systems installations worldwide. these products. As surface and subsea Cameron’s CAMSERV initiatives
The mid-1998 acquisition of Brisco production activity improves in the are designed to provide flexible, cost-
Engineering’s aftermarket operations wake of higher oil and gas prices, sub- effective solutions to customer after-
added to the Company’s controls serv- stantial opportunities for new orders market needs throughout the world.
ice capabilities. Cameron Controls’ should develop during 2000. CAMSERV combines traditional
customer support and response effort aftermarket services and products,
Aftermarket
will benefit from the related CAMSERV such as equipment maintenance and
Although the aftermarket business
efforts and Cameron’s extensive net- reconditioning, with Cameron’s infor-
experienced a decline as a result of
work of service facilities. mation technology toolset, including
depressed oil and gas prices for much SAP™ and CAMWARE™. CAMWARE
Cameron Willis of 1999, the decline was less severe than is a proprietary customer asset man-
Cameron Willis’ product portfolio for new product sales. As pressures agement software which tracks equip-
includes Cameron and Willis brand increased on customers to reduce costs, ment throughout its life, whether in
drilling choke systems, and Cameron the CAMSERV program was initiated storage, undergoing repair or mainte-
and Willis brand chokes and choke in order to provide them with cost- nance, or on a well. Several CAMSERV
actuators for the surface and subsea effective solutions. alliance agreements, which utilize
production markets. Cameron Willis Aftermarket revenues, which have CAMWARE to reduce cost over the
was created in order to take advantage consistently produced attractive profit complete life cycle of the equipment,
of opportunities for manufacturing margins (as a result of our customers’ are now in place with customers. As
consolidation, technology improve- willingness to share the life cycle cost operators continue to look for ways to
ment and product cost reductions. reductions achieved through the appli- reduce drilling, completion and pro-
While 1999 orders for chokes and cation of CAMSERV), continued to duction costs, additional opportunities
actuators were below the record levels of increase as a percent of total revenue, to forge CAMSERV alliance agreements
1998, sales from existing backlog were albeit partly because of a decline in new with customers will develop.
relatively strong during the year. As a product sales. Meanwhile, Cameron’s
result, Cameron Willis has clearly estab- worldwide market share increased sig-
lished its position as the worldwide nificantly, particularly in the drilling
market share leader in subsea chokes. business. The increased exploration
The consolidation of primary choke and production activity expected in
manufacturing in the Longford, Ireland 2000 should particularly affect the
facility began in 1998. Significant bene- aftermarket arena, likely increasing its
13

16. Cameron® welded-body
ball valves are renowned
worldwide for utilization
in onshore, offshore
and subsea pipeline
applications.
14

17. 19 STATISTICAL/OPERATING
99 HIGHLIGHTS
($ millions)
1999 1998 1997
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $231.7 $309.0 $244.9
EBITDA1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.4 60.9 47.2
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.9 5.6 4.3
Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209.8 279.5 248.6
Backlog (as of year-end) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.4 54.4 61.0
Excludes nonrecurring/unusual charges.
1
Cooper is a leading provider of valves and related systems primarily used
to control pressures and direct oil and gas as they are moved from
Cameron
individual wellheads through flow lines, gathering lines and transmis-
Valves
sion systems to refineries, petrochemical plants and industrial centers
(CCV) for processing. Equipment used in these environments is generally
required to meet demanding API 6D and American National
Standards Institute (ANSI) standards.
$309
$280
$61
$61
$249
$54
$245
$232
$210
$47
$33
$32
97 98 99 97 98 99
97 98 99 97 98 99
Revenues Orders
EBITDA Backlog
($ millions) ($ millions)
($ millions) (at year-end, $ millions)
15

18. Financial overview of schedule and below budget; manu- 1999, valves were supplied for projects
facturing operations in Europe were in the North Sea, Philippines and the
CCV’s revenues declined to $231.7
restructured to allow greater flexibility Gulf of Mexico in water depths as great
million for the year, down 25 percent
in responding to future shifts and cycles as 5,000 feet. Development is contin-
from 1998’s $309.0 million, as markets
in the market; and the Orbit Valve sales uing on a range of valves capable of
for all of CCV’s valve products were
offices were consolidated to reap the performing at pressures of 10,000 psi
weaker. EBITDA (excluding nonrecur-
benefits of integrated sales forces. and in water depths of 10,000 feet.
ring charges) fell to $33.4 million, down
CCV is coordinating its efforts with
45 percent from $60.9 million a year Focus on subsea product
those of Cameron’s R&D staff to meet
ago. EBITDA as a percent of revenues development
the requirements of ultra-deep water
was 14.4 percent, down from 1998’s 19.7
Maintaining its position as an projects offshore West Africa.
percent. CCV’s orders remained soft
industry technology leader, CCV is CCV is also contributing its expert-
throughout the year, despite strength-
applying its 30 years of experience in ise to a consortium of industry leaders
ening energy prices during the second
subsea pipeline applications to the involved in developing a hot tapping
half of 1999. In response to the market
development of ball valve designs and system, allowing operators to tap into
weakness, CCV restructured operations
accessories to meet the challenges of existing pipelines in water depths of up
and reduced working capital employed
deep water and high pressure. During
in the business by 44 percent.
Operations restructured
In the face of the lingering down-
turn in activity, CCV undertook signif-
icant restructuring efforts at several of
its facilities. The previously announced
closure of the Missouri City, Texas facil-
ity and the consolidation of those oper-
ations into the Oklahoma City,
Orbit’s® unique
Oklahoma plant were completed ahead
block valve technology
provides valves with
Web access to aid
customer purchasing unmatched durability,
safety and long-term
performance that are
In early 2000, CCV will launch
ideal for use where
a “Valve Advisor” on the Internet to
frequent cycling and
facilitate the purchase of engineered
positive shutoff
products over the web. Customers are required.
and distributors will have ready
access to product information,
including detailed technical draw-
ings, product availability and pric-
ing. In addition to making the
purchasing process easier and more
efficient for current customers, this
service will allow CCV to tap into
markets that are not covered via
existing distribution channels.
Information on this new tool will be
provided to users as soon as it
becomes functional.
16

19. to 10,000 feet. This technology will save opportunities for aftermarket growth, the eventual—and inevitable—return of
the industry millions of dollars by through additional enhancement of activity in its primary markets. Cost
avoiding the need to add new pipelines current facilities or through acquisitions reduction efforts, restructuring and orga-
for every offshore field development. of similar service-based companies. nizational realignment will help CCV
respond more efficiently to changes in the
2000 Outlook
Cost reduction and value
market. Current product offerings are
engineering
Although a relatively slow recovery is being consolidated and rationalized, new
CCV’s engineering, manufactur- anticipated across CCV’s business lines product development continues and after-
ing and purchasing organizations during 2000, CCV remains prepared for market growth initiatives will continue.
undertook a combined effort to imple-
ment a variety of best practices and
make significant cost reductions during
Foster® D-Seal gate valves
1999. Value engineering, productivity
feature the unique D-Seal
improvements, inventory reductions,
technology, which virtually
period cost reductions and aggressive
doubles the anticipated time
sourcing were among the steps taken in
between major gate and
response to price competition during a
seat repair. Its simple,
challenging year. These actions will
accessible design and in-line
help CCV continue to provide com-
repairability make it ideal
petitive products without compromis-
for a variety of applications.
ing the superior technology and quality
that its customers expect.
Customer relationships lead
to new markets
CCV has developed long-term
alliances with a variety of its customers,
providing them with the stability and
support that comes from a relationship
with an industry leader. Such alliances
also provide CCV with opportunities
for expanding into new markets. In
1999, CCV’s alliance relationships led
to placement of valves in subsea appli-
cations in the Gulf of Mexico and in the
Asia-Pacific region, in power plants and
gas utility applications in the north-
eastern U.S., in coalbed methane recov-
ery efforts in the Rocky Mountain
region and in significant refinery proj-
ects in Mexico.
Focus on aftermarket
Throughout 1999, CCV made
aftermarket growth a priority. Key ini-
tiatives included the integration of CCV
and Orbit aftermarket personnel into
one organization, greater emphasis on
aftermarket center operations and the
conversion of the Odessa, Texas service
center to a full-service aftermarket
facility. CCV will continue to consider
17

20. CES’ newest engine introduction, the
gas-fueled Superior® HG engine, is
designed for high-end gas compression
and power generation markets.
21
18

21. 19 STATISTICAL/OPERATING
99 HIGHLIGHTS
($ millions) 1999 1998 1997
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $317.1 $417.7 $527.3
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.9 24.7 54.5
1
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.9 20.7 9.2
Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 378.7 380.8 464.5
Backlog (as of year-end) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74.3 93.4 129.9
Excludes nonrecurring/unusual charges (credits).
1
(Note: Through September 1999, CES’ results included the
rotating compressor business that was sold to Rolls-Royce.)
Cooper is a leading provider of reciprocating power and compression equip-
ment and customer integrated services, including aftermarket parts
Energy and services, for the oil and gas production and independent power
industries. Customers include major oil and gas companies, large
Services
independent oil and gas producers, gas transmission companies and
(CES) equipment leasing companies.
CES’ products include natural gas fueled combustion engines, recipro-
cating compressors, turbochargers, control systems, replacement parts
and services marketed under the Ajax®, Superior®, Cooper-Bessemer®
(Reciprocating Products), CB Turbocharger®, Penn™, Enterprise™ and
Texcentric® brand names.
CES utilizes manufacturing facilities in the U.S. and sales and service
offices around the world to sell and deliver its products and services.
$465
$130
$527
$55
$381
$379
$418
$93
$317
$74
$25
$10
97 98 99 97 98 99 97 98 99
97 98 99
Revenues Orders Backlog
EBITDA
($ millions) ($ millions) (at year-end, $ millions)
($ millions)
19
22

22. Financial overview the sale of its rotating business to Rolls- gas re-injection, transmission, storage
Royce for approximately $200 million. and withdrawal and gas processing
CES’ revenues were down approx-
As part of the transaction, Roll-Royce applications. Additionally, CES sells
imately 24 percent for 1999, due largely
acquired several CES manufacturing Superior natural gas driven engines for
to the Rotating business, which was
and service locations, including the high-speed compression and power
sold as of the end of the third quarter.
Mount Vernon, Ohio facilities. generation projects.
Revenues totaled $317.1 million, down
Cooper Cameron decided to The reciprocating group achieved
from 1998’s $417.7 million. EBITDA
divest this product line because it did significant gains in the 100 to 800
(excluding nonrecurring charges/credits)
not control the key technology, the horsepower market segment with reli-
was 60 percent below year-ago levels at
engine, and had limited aftermarket able, low operating cost Ajax integral
$9.9 million, compared with $24.7
opportunities. units and the new line of CES rotary
million in 1998. EBITDA as a percent
screw packages introduced in 1998. In
of revenues was 3.1 percent, compared Compression products
addition, work was initiated to add a
with 5.9 percent during 1998. enhanced
proprietary 1,150 psi high-pressure
Reciprocating compression sys- rotary screw system to the offering, as
Rotating business sold
tems include Superior high-speed sep- well as continued development and
For more than twenty years, CES arable compressors, Ajax integral extension of the high-speed Superior
marketed rotating (centrifugal) com- engine-compressors and Cooper reciprocating compressor line. The
pression and power packages through Energy Services rotary screw com- WG compressor has been introduced
Cooper Rolls, a joint venture between pressors powered by natural gas in 2000 to provide large-project com-
CES and Rolls-Royce plc. CES pro- engines and electric motor drives. pression on applications up to 9,000
vided rotating compressors, power tur- These compression systems cover horsepower.
bines and controls, while Rolls-Royce requirements in a wide range of horse- Superior’s established line of nat-
provided the gas generators. On power needs for gas gathering, gas-lift, ural gas engines is used in both the gas
September 30, Cooper Cameron closed
compression and power generation
markets. During the year, the high-
speed Superior 2400G engines, available
in six, eight, twelve or sixteen-cylinder
New engine, compressor add to product offerings
configurations, were enhanced with
the addition of more user-friendly
controls, detonation-sensing technol-
In response to customer needs, CES has introduced the new, higher-
ogy and low-compression power pis-
horsepower, Superior HG engine. This natural gas-fueled engine is rated tons. Development of a new line of
high-horsepower engines for the
at 5,000 HP (550 HP higher than the nearest competition) and will serve
compression markets was also initi-
high-end gas compression and power generation markets worldwide. ated during the year. In addition,
several distributor agreements were
As a complement to the HG engine, CES has also introduced the
established to extend Superior’s posi-
Superior WG compressor series. These high-speed separable compressor tion in the power generation mar-
ket, as well as in other mechanical
units can be matched with either natural gas engine drivers (like the HG
drive applications.
engine) or electric motors for upstream production, mid-stream
processing and gas transmission markets. The speed, power and versa-
tility of the WG series provide a significant installed cost advantage over
competitive equipment in the same power range. CES’ first sale of the new
unit was for an electric motor-driven fuel gas boosting application, and
is to be installed in the third quarter of 2000.
20