<SEC-DOCUMENT>0000950123-11-053160.txt : 20110822
<SEC-HEADER>0000950123-11-053160.hdr.sgml : 20110822
<ACCEPTANCE-DATETIME>20110523192236
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000950123-11-053160
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20110523

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NATIONAL OILWELL VARCO INC
		CENTRAL INDEX KEY:			0001021860
		STANDARD INDUSTRIAL CLASSIFICATION:	OIL & GAS FILED MACHINERY & EQUIPMENT [3533]
		IRS NUMBER:				760475815
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		7909 PARKWOOD CIRCLE DR
		CITY:			HOUSTON
		STATE:			TX
		ZIP:			77036
		BUSINESS PHONE:		713-375-3700

	MAIL ADDRESS:	
		STREET 1:		7909 PARKWOOD CIRCLE DR
		CITY:			HOUSTON
		STATE:			TX
		ZIP:			77036

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	NATIONAL OILWELL INC
		DATE OF NAME CHANGE:	19960829
</SEC-HEADER>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><IMG src="h82530national.gif" alt="(National Oilwell Varco Logo)">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><FONT style="white-space: nowrap">National Oilwell Varco, Inc.</FONT></TD>
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><FONT style="white-space: nowrap">7909 Parkwood Circle Drive</FONT></TD>
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">Houston, TX 77036</TD>
</TR>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">PHONE 713-346-7500</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">FAX 713-346-7995</TD>
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<DIV align="center" style="font-size: 10pt; margin-top: 18pt">May&nbsp;23, 2011
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">U.S. Securities and Exchange Commission<BR>
Division of Corporation Finance<BR>
100 F. Street, N.E.<BR>
Washington, D.C. 20549<BR>
Attn: Mr.&nbsp;Ethan Horowitz

</DIV>

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    <TD nowrap align="left">RE:</TD>
    <TD>&nbsp;</TD>
    <TD><B>National Oilwell Varco, Inc. (the &#147;Company&#148;)<BR>
Form&nbsp;10-K for Fiscal Year Ended December&nbsp;31, 2010<BR>
Filed February&nbsp;23, 2011 (&#147;2010 Form&nbsp;10-K&#148;)<BR>
File No.&nbsp;001-12317</B></TD>
</TR>
</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Ladies and Gentlemen:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">This letter responds to the comments that the Company received from the Staff of the Division of
Corporation Finance (the &#147;Staff&#148;) of the U.S. Securities and Exchange Commission (the &#147;Commission&#148;
or the &#147;SEC&#148;) on May&nbsp;3, 2011 by letter dated May&nbsp;2, 2010. For your convenience, the Company&#146;s
responses are prefaced by the Commission&#146;s comment in bold text. All capitalized terms used herein
and not defined herein shall have the meanings given to them in our 2010 Form 10-K.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Form&nbsp;10-K for Fiscal Year Ended December&nbsp;31, 2010</B></U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>General</B></U>
</DIV>


<DIV style="margin-top: 6pt">
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    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>1.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>We note from publicly available company profiles and analyst reports that you
have conducted business in and exported to Iran. We also note publicly available
profiles for managers for your company in the Syria, Turkey and Jordan region. We note
from an October&nbsp;2010 news article that your company may have supplied a blowout
preventer to a rig in Cuba. Finally, we note from pages 16 and 20 of your Form&nbsp;10-K
that you have operations in Africa.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&nbsp;</B></TD>
    <TD width="1%"><B>&nbsp;</B></TD>
    <TD><B>Sudan, located in Africa, and Iran, Syria and Cuba are identified by the State
Department as state sponsors of terrorism and are subject to U.S. economic
sanctions and export controls. We note that your </B><B>Form 10-K</B><B> does not include
disclosure about business contacts with these countries. Please describe to us the
nature and extent of your past, current, and anticipated contacts with Iran, Syria,
Sudan and Cuba,
whether through subsidiaries or other direct or indirect</B></TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B></B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>arrangements. Your
response should also describe any services or products you have provided to Iran,
Syria, Sudan or Cuba and any agreements, commercial arrangements, or other contacts
you have had with the governments of Iran, Syria, Sudan or Cuba, or entities
controlled by these governments.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: Prior to 2007, the Company, through independent foreign subsidiaries, conducted some
business in Syria and Iran, but the total sales were immaterial. The Company has also disclosed,
in a separate inquiry with the SEC&#146;s Division of Enforcement, certain direct and indirect
activities, including those by the Company&#146;s independent foreign subsidiaries, in which goods may
have had a final destination in Sudan or Cuba. These sales were also immaterial. In late 2007,
the Company implemented a new policy prohibiting new sales, either direct or indirect, to Iran.
The Company has not engaged in any activities in Iran, Sudan or Cuba since 2009 and does not intend
to engage in any activities in these countries in the future.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">One of the Company&#146;s independent foreign subsidiaries is currently engaged in a very limited number
of projects in Syria. The total sales for these few projects are immaterial. The Company is not
accepting any new business related to Syria and, as soon as the current projects are complete, will
have no further business contacts with Syria. The contracts for the current Syrian projects are in
compliance with US and local law.
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>2.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Please discuss the materiality of your contacts with Iran, Syria, Sudan or
Cuba described in response to our foregoing comment and whether those contacts
constitute a material investment risk for your security holders. You should address
materiality in quantitative terms, including the approximate dollar amounts of any
associated revenues, assets, and liabilities for the last three fiscal years and
subsequent interim period. Also, address materiality in terms of qualitative factors
that a reasonable investor would deem important in making an investment decision,
including the potential impact of corporate activities upon a company&#146;s reputation and
share value. Various state and municipal governments, universities, and other
investors have proposed or adopted divestment or similar initiatives regarding
investment in companies that do business with U.S.- designated state sponsors of
terrorism. Your materiality analysis should address the potential impact of the
investor sentiment evidenced by such actions directed toward companies that have
operations associated with Iran, Syria, Sudan and Cuba, and should discuss the
possibility for reputational harm from your joint venture with Schlumberger and your
relationship Samsung Heavy Industries. In this regard, we note that your joint venture
partner Schlumberger states on its website that it has operations in Iran, Syria,
Sudan and Cuba. We note also that your significant customer Samsung Heavy Industries&#146;
parent has an office in and conducts business in Iran.</B></TD>
</TR>




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</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: From January&nbsp;1, 2008 to December&nbsp;31, 2010, (during which time period the Company&#146;s
independent foreign subsidiaries were winding down any remaining activities in Iran and Syria) as
disclosed to the SEC&#146;s Division of Enforcement, through the Company&#146;s internal investigation, in
addition to sales described in number 1 above to Iran, Sudan or Syria, the Company identified
certain other sales for which the Company&#146;s customer may have shipped or used goods in Cuba. For
the period January&nbsp;1, 2008 to December&nbsp;31, 2010, direct sales identified to date to these countries
were less than 0.3% of total revenues. Therefore, on a quantitative basis, the Company&#146;s direct
contacts with these countries are immaterial.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">As noted in our response to comment no. 1, the Company does not currently engage in any business
activities in Sudan, Iran or Cuba. The Company&#146;s current limited business contacts in Syria are
winding down. The Company does not intend to engage in any activities in any of these countries in
the future. Therefore, the Company does not believe its current limited contacts in Syria or its
prior limited contacts in any of the four countries in question based on contracts entered into
before 2007 are material on a qualitative basis.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">As to Schlumberger and Samsung Heavy Industries, we have disclosed these relationships in our Form
10-K and have not received any indication from any investor or potential investor that these
relationships are problematic nor are we aware of any information or market data that indicates the
Company has, or could possibly suffer, any reputational harm as a result of these relationships.
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>3.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>We note the disclosure on page 20 regarding government inquiries related to
compliance with export trade laws and regulations and your subsequent internal review.
Please tell us the nature of the actions underlying the inquiries and the countries
involved.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: The SEC&#146;s Division of Enforcement is familiar with these inquiries. The review
concerned the extent to which the Company had conducted business with Iran, Cuba, and Sudan through
foreign subsidiaries and information related to any such business. Ms.&nbsp;Tracy Price can provide
information regarding the nature of the inquiries and the countries involved.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations
Executive Summary, page 36</B></U>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>4.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>We note you have presented certain non-GAAP measures in your filing such as
diluted earnings per share excluding intangible asset impairment and transaction,
devaluation and voluntary retirement charges and operating profit excluding
transaction charges. However, it does not appear that the presentation of these
non-GAAP measures is accompanied by a clearly understandable reconciliation to the
most directly comparable GAAP measures. Please confirm that you will provide this type
of reconciliation in connection with the future
presentation of any non-GAAP measures. Refer to Item&nbsp;</B><B>10(e)(1)(i)</B><B> of Regulation&nbsp;S-K.</B></TD>
</TR>

</TABLE>
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</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: The Company will provide this type of reconciliation in connection with the future
presentation of any non-GAAP measures.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Financial Statements</B></U>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Notes to Consolidated Financial Statements</B></U>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Note 10 &#151; Employee Benefit Plans, page 81 </B></U>

</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>5.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>It does not appear that you have provided all of the required disclosures
regarding your defined-contribution benefit plans. For example, it does not appear
that you have provided the required disclosures regarding amounts recorded in
accumulated other comprehensive income related to these plans. It also does not appear
that you have provided disclosure regarding the assumed health care cost trend rate
used to measure your benefit costs. Please revise to provide the disclosures
prescribed by FASB ASC 715-20-50.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: The total liability for defined-contribution benefit plans as well as the amount related
to these plans recorded in accumulated other comprehensive income at December&nbsp;31, 2010, was not
material to the Company&#146;s financial position, cash flow or results of operations. Specifically, the
estimated liability represented by the funded status of the Company&#146;s plans at December&nbsp;31, 2011
was $102&nbsp;million (0.4% of total assets). A one percentage point increase in the assumed health
care cost trend rate for 2011 will increase the obligation by $2.2&nbsp;million (0.09% of total
operating profit), and a one percentage point reduction will decrease the obligation by $1.9
million (0.08% of total operating profit). In addition, the cumulative loss related to defined
benefit plans recorded in Other Comprehensive Income at December&nbsp;31, 2011 was $48&nbsp;million (0.2% of
total assets). Due to the immateriality of our defined-contribution benefit plans, the Company does
not believe additional disclosure is necessary.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Note 12 &#151; Commitments and Contingencies, page 85 </B></U>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>6.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>We note your disclosure stating that your total liability related to claims,
regulatory agency audits, and pending or threatened legal actions cannot be determined
at December&nbsp;31, 2010. Your disclosure also states that any ultimate liability related
to these matters, to the extent not otherwise provided for, will not materially affect
your financial position, cash flow, or results of operations. Please describe any
matters for which you have recorded a contingent liability (i.e., the amounts that
have been provided for, as indicated in your footnote) pursuant to FASB ASC 450-20-25.
In addition, with regard to contingencies for which you have not recognized a
liability, please</B></TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR valign="top" style="font-size: 10pt; color: #textcolor#; background: #bgcolor#">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>provide disclosure regarding management&#146;s assessment of the probability that a
liability has been incurred and the related possible loss or range of loss. Refer
to FASB ASC 450-20-50-3 through 450-20-50-4.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: The Company has assessed all contingencies it believes to be probable or reasonably
possible, and determined that the estimated liability for those matters individually and in
aggregate will not materially affect the Company&#146;s financial position, cash flow or results of
operations. These estimated liabilities are based on the Company&#146;s assessment of the nature of
these matters, their progress toward resolution, the advice of legal counsel and outside experts,
as well as management&#146;s intention and experience. The Company will address the foregoing in its
future disclosures.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Form&nbsp;8-K filed April&nbsp;27, 2011 </B></U>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>7.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>We note you present an EBITDA measure and a corresponding reconciliation to
net income. However, your reconciliation and definition of EBITDA presented includes
an additional adjustment for transaction and devaluation costs, the inclusion of which
does not conform to the specifically defined measure, EBITDA, as described in Item
1</B><B>0(e)(1)(ii)(a)</B><B> of Regulation&nbsp;S-K. Please confirm that you will revise future public
disclosures to reflect the proper measure for EBITDA or that you will revise your
disclosures to more accurately depict the non-GAAP measure you are presenting.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Response: The Company will revise future public disclosures to reflect the proper measure for
EBITDA and revise its disclosures to more accurately depict the non-GAAP measure it is presenting.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In providing this response letter to the Staff, the Company acknowledges that (i)&nbsp;the Company is
responsible for the adequacy and accuracy of the disclosure in the above-referenced filings, (ii)
Staff comments or changes to disclosure in response to Staff comments do not foreclose the
Commission from taking any action with respect to the above-referenced filings, and (iii)&nbsp;the
Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or
any person under the federal securities laws of the United States.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If you or any member of the Staff has any questions regarding the responses set forth herein,
please contact the undersigned at (713)&nbsp;346-7550.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Sincerely,<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ Dwight W. Rettig
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Dwight W. Rettig&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Senior Vice President, General Counsel
and Secretary&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
