Teddy--
From ESV's 10-K, here's the skinny on ESV / Coastal. None of this may be news to anyone except me. I present it a day late, and -- like most other investors -- many, many dollars short.
I think those new contracts came on rigs not employed by Coastal. Offshore Data reported new work for Ensco 88, Ensco 95 and Ensco 51. According to ESV's 10-K, with data as of Feb. 1, Coastal's three jackups were Ensco's 81, 82 and 87. But, of course, none of this even matters if, as the I.R. rep claimed, they've got other jobs lined up for the newly free Coastal rigs. Business as usual?
Also, this: Same 10-K lists $46,530 as the average dayrate ESV received for their Gulf jackups in 1997. According to Ms. Scanlon's article "rigs in a similar class to those that Ensco had contracted to Coastal were bringing in dayrates of between $55,000 and $73,000 in the Gulf." She also writes that the one rig Coastal chose to retain was "renewed through July at a dayrate in the high $60,000 range."
I know that all jackups are not created equal, but it seems likely to me -- any way this gets sliced -- that ESV is, as expected, making a boatload more than their FY 97 average. If dayrates do get squeezed -- and Ms. Scanlon's article comes nowhere close to proving this supposition -- the dollar start point for negotiations has already been raised substantially. Bring on earnings, I say.
ian -- your man for breaking news already broke |
