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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: BigBull who wrote (54653)	11/12/1999 5:55:00 PM
From: upanddown	Read Replies (2) \| Respond to of 95453

Bull, the asbestos problem with MDR has little or nothing to do with the patch but strictly the subsidiary Babcock & Wilcox which is the largest maker of industrial boilers in the world. B&W has been a major supplier to utilities for many years. It was founded in 1867 and was an industrial icon on its own for a century. According to the 10-Q the asbestos liability has actually declined since March and is at least 80% covered by insurance. Worst case liability is 1.376B....insurance 1.212B. Maybe cost MDR 100-200M in a worst-case scenario and that to be paid out over many years. Vastly overblown in my opinion. So the liability lawyers make unreasonable claims. B&W then threatens to go to the mattresses. The lawyers, whose main interest are their contingency fees, suddenly get more reasonable. Big deal. MDR made around $200m each of the last two fiscal years, over $3 a share. While admittedly off to a lousy start this fiscal year, Boom2000 could improve things. MDR sells for 500M, around two months sales. When management finesses the asbestos claims, it should quickly return to reasonable value. John

To: BigBull who wrote (54653)	11/13/1999 6:51:00 AM
From: Aggie	Respond to of 95453

BB, good morning, Last year I considered taking a drillship on that was a reconverted freighter - as many older drillships are. One of the considerations was the exposure to asbestos, which is one of the best insulating materials you can get - so anything older (> 25 years) that has a boiler / steam system will almost certainly have asbestos somewhere. I don't know how many of the shipping / rig fleet have this problem, but as I said yesterday - there have been advances in coatings which can be applied to seal this stuff off so that the day-to-day exposure is eliminated. This leaves only maintenance and repair issues, i.e. having to remove insulation in order to service equipment. The rig I was considering had commissioned a full Safety Case which in turn had generated a Safety Management System that would allow certain work of limited scope to proceed when necessary. Major work had to wait for the shipyard, where the stuff could be contained. In addition, the management system installed a schedule of monitoring. Having said that....it would appear after further investigation that B&W's problem is largely industrial, probably centering on their nuclear construction business. Talk about Safety Management, geez. Asbestos is the least of their worries. Note to drillers: The Soviets used to use asbestos as lost circulation material, and take my word for it boys, it works. Just don't try to produce from it. Regards and good luck to all, Aggie