Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: Broken_Clock who wrote (35600)	1/21/1999 8:49:00 PM
From: Big Dog	Read Replies (4) of 95453

Pineapple Breath, There are a number of projects under discussion that would utilize the Canadian yard. These are big projects that do not come together quickly. I think FGI is going to surprise everyone as it announces new projects amid the doldrums of the curent "bust". Back to the Canadian yard, I don't know what the current level of activity is today at the yard. Keep in mind that there are now two Petrodrill semis up for grabs since being cancelled from Davie (assuming financing is obtained). I think FGI is VERY well positioned to get one or both of these contracts. The closest competitor is probably Halter, and it is my "feeling" that FGI will beat Halter -- not on price, but on perceived/demonstrated reliability. It is the MARAD loan guarantees that will steer the two semi contracts to a U.S. yard. MARAD will provide a U.S. - backed guarantee for up to 87.5% of the construction contracts, resulting in an interest rate of about 80 basis points over a 10-yr treasury. Try and beat that deal, Mr. Korea! Plus, it only makes sense to have both of the rigs built at the same yard to obtain some efficiencies and to not be spread out management-wise. I predict FGI will win both contracts...this work, together wil more projects coming shortly down the pipeline may almost double FGI's backlog. Will that move the stock? Beats me. In the first place, it ain't happened yet. But if I were a betting dog.... big loosbrock.com

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