Interesting. We run to a few ensco sites for Anadarko.
I was a little surprised how their analysts rated Pacific Drilling. " According to analyst projections it is also the most expensive, carrying a forward P/E of 21.We don’t see anything particularly attractive in its business or financials, and so we’d avoid it as well."
Well it does appear that TO is coming back and just picking up Shell like they just did is big. Noble is gonna feel that sting for a long time if they don’t sign up the other three available HHI ships of theirs for $450k/day or higher
I guess with any of these companies it is profits, cash, contracts, equipment. There has got to be more consolidation coming in the industry but who is going to eat who in the next 5 years? If there is any kind of price drop in oil that will all depend on who ends up with equipment they can’t charter at high dayrates?
Just like musical chairs I’d say.
TO still needs to upgrade a lot of gear over the coming years compared to other large contractors, maint costs remain high for several reasons, and utilization rates aren’t the best. It will be an interesting few years when the down cycle starts, because so many drillers have invested heaviy now in new gear, on the way up the cycle.
That is where TO stands to gain, as their cost basis will be lower, and then they might pick up the gear from the others that have to get rid of it…
The Turdwater stategy?
[QUOTE=+A465B;86216]TO still needs to upgrade a lot of gear over the coming years compared to other large contractors, maint costs remain high for several reasons, and utilization rates aren’t the best. It will be an interesting few years when the down cycle starts, because so many drillers have invested heaviy now in new gear, on the way up the cycle.
That is where TO stands to gain, as their cost basis will be lower, and then they might pick up the gear from the others that have to get rid of it…
The Turdwater stategy?[/QUOTE]
I don’t think so. They’re shedding all the old jackups and lost the DISCOVERER 534 recently rather than dump any more money into it (Helix is going to convert her to a well intervention vessel). If anything, unless one of their old rigs has guaranteed work, I don’t see them spending the big $$$ to keep an elderly piece of iron alive. Once the jobs end so will the rig.
The announcement that they are getting back to the newbuilding game is a sign that they are alive and breathing and it is encouraging to me to see that they continue to build against firm charters as opposed to everybody else. Conservative is safe when there is a sea of newbuilds out there without jobs yet. Also that Shell has shown a confidence in them to give them such a big contract is also very encouraging.
What I am wondering is how positioned they are to go into the major acquisition mode again? The GSF deal appears to have been a coup that turned to gold and the Aker deal was so small to not really register. Who might be next is a very big question? I always thought Pacific but many here say no. Could Vantage be in the cards? I guess it would be whoever they could buy for cheap. Who’s vulnerable?
What other combinations exist out there? Who is strong and who is weak? Any of the major Americans be dancing with eachother? Seems the pull of gravity of economy of scale should bring at least as couple together soon. Atwood, Diamond, Rowan, ENSCO and (holding nose) Noble?
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Here’s an interesting graphic that came from an Ocean Rig presentation that gives a good snapshot of the world deepwater drilling fleets by company
TO has a few drill ships in the gulf. Discoverer Spirit just came back from Africa not too long ago