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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: Gary Burton who wrote (39098)3/6/1999 1:31:00 PM
From: Think4Yourself  Read Replies (1) of 95453
 
I am not concerned about FGI and GIFI. I believe they can "coin" it all the way through based on what I am observing. "All the way through" looks to mean the end of this year for GOM activity, due to the current gas situation/outlook. They also do not want to lose key workers, as they have been burned in the past as those workers have exited the industry and were to difficult to replace when demand picked up. Witness the McDermott crane operators brilliant manipulation of the fabbed deck recently <VBG!>

The way I see it. when your equipment is in high demand at highly profitable rates, it is intelligent to put off "optional" maintenance/upgrades as long as possible. Now that there is slack time, these not-cash-strapped drillers are finally getting around to the "optional" stuff. Witness the Rowan CEO talking about all of their rig upgrades for proof.

It has been suggested that the drillers will wait until things pick up to do these things. I strongly disagree. When things pick up, they will pick up for everyone. do the drillers want to lose contracts/cash while they wait in line for maintenance? Sounds assinine to me. They will maintain rigs as they come off service this year because they know the slack situation is temporary, and they would be fools not to take advantage of it.

lastly, he who has the best equipment is least likely to lose contracts for "non-performance".
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