Hello all,
So I have been speaking with some people and almost all of them are talking about how slow the GoM is right now. I have heard that bidding activity for OCVs is really low. Why might this be? Lack of new projects or backlog falling off? It looks like a lot of vessels are working the spot market right now. The only boats with consistent work appear to be Well Intervention vessels, but I believe that is because they have been awarded sizeable backlogs. What are y’all seeing?
[QUOTE=SomeGuy;141547]Hello all,
So I have been speaking with some people and almost all of them are talking about how slow the GoM is right now. I have heard that bidding activity for OCVs is really low. Why might this be? Lack of new projects or backlog falling off? It looks like a lot of vessels are working the spot market right now. The only boats with consistent work appear to be Well Intervention vessels, but I believe that is because they have been awarded sizeable backlogs. What are y’all seeing?[/QUOTE]
The shelf is abnormally slow and deep water is not as busy as people anticipated at this point.
Chevron has 3 drill rigs coming in the next year and I’m sure ECO has those. One should be in the Gulf in the next 2 months. Shallow I have no Idea about though.
I know an oil company that has two semis and a drillship enroute to the GOM from Asia as we speak. I believe delivery is staggered over the next couple of months.
[QUOTE=Fraqrat;141614]I know an oil company that has two semis and a drillship enroute to the GOM from Asia as we speak. I believe delivery is staggered over the next couple of months.[/QUOTE]
I think the shipbuilding and hiring frenzy gave a misrepresentation of the market at the current time. Some people didn’t realize that to prepare for the upcoming demand it would take 2-3 years to be ready when the time came. I do know that various dockside services are being contracted out ahead of time out of fear of not having someone to perform the work when the time comes. Having a nice drillship on a 3 year charter is great but if you don’t have a dock, liquid mud vendor, tank cleaning vendor, etc… you can’t function.
well HOS seems to feel all is fine for their future
[B]Hornbeck Confident New Rigs Will Get Absorbed in Gulf of Mexico
[/B]
By Rob Almeida On July 31, 2014
Hornbeck Offshore (NYSE: HOS), a Gulf of Mexico-focused operator of offshore support vessels reported a strong second quarter today with a 25 percent jump in upstream revenue to $171.1 million over the previous quarter while diluted earnings per share were up 174 percent.
HOS attributes the revenue jump to “the full or partial-period contribution of 13 vessels that were placed in-service under the Company’s fifth OSV newbuild program or redelivered under the 200 class OSV retrofit program since June 2013.”
Full utilization of their fleet of four Multi-Purpose Support Vessels (MPSVs) at record day rates of around $130,000 per day also contributed to the revenue boost. These rates are about $40,000 per day higher than they were a year ago according to CFO James O. Harp, Jr. Looking into the second half of 2014, the results are not repeatable however, as a few of the vessels have signed long term charters. CEO Todd Hornbeck notes in the company’s earnings call this morning that “good positioning in the spot market this quarter led to the signing of good long term charters for the vessels.”
Across the Hornbeck’s fleet of OSVs however, utilization was slightly lower over the period “due to 74 incremental vessel-days out-of-service for regulatory recertification during the second quarter of 2014 compared to the prior-year period, along with transitory softness for high-spec OSVs operating in the GoM spot market.”
As a company that primarily supports the development of offshore oil fields, their growth is tied directly to the activities of the drilling rigs they support. So far this year, Hornbeck notes there hasn’t been much change in the deepwater drilling market with an average of 38 rigs operating in the Gulf of Mexico. Looking ahead however, 12 new high spec rigs are scheduled to enter the region by 2015 with a matching number of new OSVs, 6 of which will be owned by HOS.
The big question is which of those rigs will come on line and start working and what will happen to some of the older rigs that may be coming off contract over that period.
Todd Hornbeck comments in his company’s earnings report today that “when we settle into a 50 plus rig working environment, excess capacity will get absorbed.” The older units will still be put to work, perhaps at a lower day rate, but could potentially bring in additional customers, notes Hornbeck.
“We’re seeing a period of unprecedented growth. There’s no objective evidence that 50 deepwater rigs won’t operate [in the Gulf of Mexico], adds Hornbeck while pointing to the political stability and predictability of the region’s operating environment. “Its a preferred destination for majors and independents.”
Average day rates for new generation OSVs last quarter were $27,565 compared to $26,079 for the same period in 2013 and $26,237for the first quarter of 2014.
Offshore Mexico, amid the country’s reforming energy landscape, Hornbeck doubled their fleet with 7 new vessels put on long charter. The fleet there now stands at 13.
In Brazil, the company has only 4 vessels on charter and Hornbeck notes they have elected not to participate in Petrobras’ latest PSV tender.
Hornbeck’s operating fleet consists of 57 new generation OSVs and four MPSVs with 15 more HOSMAX OSVs under construction. 7 more will be delivered by year end. By the end of 2015, the fleet of OSVs and MPSVs will stand at 68 and 7, respectively.
That’s why I work there!
Anadarko has 4 drill ships from summer 2014 through 2015. Chouest has picked those up as well.
There are other companies supplying boats to Anadarko besides Chouest. Every oil company has multiple OSV company’s providing boats. Chouest didn’t pick up anything. There will be a HOS, HGIM, or Gulfmark vessel running those rigs also.
Not hard to “pick up” contracts when you buy boats that already have them. lol. Anyone who thinks we gain anything buy buying those junk boats to pick up 4 Anadarko contracts is delusional. All we did was keep four boats (now more than that) out of Harvey’s hands and take a two generation step backwards in our OSV fleet…but they WILL make money and thats all thats important. Wonder if we will see the same posturing and backstabbing to get one of the Bollinger boats as we have the 312’s…lol
We moved my rig over seas earlier this year, and the sister rig to it will be heading to west Africa or the Med soon. One of the new build drill ships in route to the GOM now only has a contract for 3 wells then it will be heading over seas as well.
[E=Fraqrat;141814]There are other companies supplying boats to Anadarko besides Chouest. Every oil company has multiple OSV company’s providing boats. Chouest didn’t pick up anything. There will be a HOS, HGIM, or Gulfmark vessel running those rigs also.[/QUOTE]
Of course there are. Which is good for all companies. I say chouest because I know. I am sure other companies will get contracts as well. That being said. I think it is a bad idea for one company to have it all. Competition is good. Makes you grow. If not then you get stagnant and wages stay low.