From Lehman this morning....note the reference to PKD at the bottom...got PKD?
International Jackup Markets Poised to Tighten Significantly
* We are getting considerable anecdotal evidence that international
offshore drilling is accelerating and that the 20% increase in spending is
starting early in the year.
* In particular, the 3 supermajors (ExxonMobil, BP Amoco and Shell)
appear poised to become much more active.
* International jackup markets are already tight and will become
tighter.
* Currently
390 Jackups in total
347 Under contract = 89% utilization
359 actively marketed supply (other 31 cold stacked, out of service
or in the shipyard)
Thus, actively marketed utilization is 96%
* Three jackup markets in particular (North Sea, West Africa and Asia
Pacific) are poised for strong day rate improvement.
North Sea - Dayrates are in the mid $50,000s now and are poised to
move to low $60,000s by Feb/Mar and low $70,000s by Spring. There are
only 2 stacked-ready jackups here and bidding is strong.
West Africa - Rates this month just went through $60,000/day, but
there are 7 tenders out (some for term work) with rates for short-term
work in the mid-to-high $60,000s and for term in the mid $70,000s. Just one
jackup in the region (a shallow water rig) is stacked ready.
Asia Pacific - A laggard in the recovery, the market has recently
moved to the mid-to-high $40,000s from the low-to-mid $30,000s. Today
companies are bidding well above $50,000 per day for 300 floaters.
* The most significant beneficiaries of this are Santa Fe
International, Global Marine, Noble Drilling and ENSCO -- all of which are
rated Strong Buy (1).
* Most recent earnings reports have been at or above our estimates.
Three companies reporting Tuesday with an excellent chance of an upside
surprise are WFT, SII and PKD. |
