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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: ldo79 who wrote (6)3/19/2001 2:14:48 PM
From: Big Dog  Read Replies (2) of 206338
 
Ido, There will come a time, maybe this year, when the world will realize that 1) We need more rigs - including jackups - ala Matt Simmons' forecasts. and; 2) The shipyard capacity does not exist to the extent commonly thought.

I can verify the lack of shipyard capacity personally as we just finished conducting a worldwide survey of 24 yards. The results should make the oil companies shake in their boots if they expect to have an adequate supply of jackups going into the coming years.

The current jackup fleet was mostly built circa 1980 and is on the decline, age wise. Attrition (or rig depletion you might call it) will likely accelerate with each added year.

This is one reason I like Chiles Offshore (COD). Small company with a handful of rigs, yet they are all brand spankin new and able to drill in the super-jackup territory. Someday I suspect one of the bigger drillers will decide it wants more jackups and make a run at COD. A significant owner of COD is Secor Smit (CKH), headed by smart guy Charles Fabrikant.

Fabrikant is very clever and made exactly the right move by ordering these rigs on spec some time back.

COD has almost zero liquidity right now and trades very thin. But 'sure as gravity' this will be a barn burner in the months to come.

big
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