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

To: Teddy who wrote (18386)	4/7/1998 11:10:00 PM
From: upanddown	Read Replies (1) \| Respond to of 95453

Teddy: I also got a response from Mavis: Hi John, Thanks for getting in touch. I received a few emails on that article, several pointing out my error in reading the BHI rig counts (correction was published this morning...you'll find it below) but others questioning the thesis of what this might mean for drillers with jackup rigs, premium or otherwise. I checked with a knowledgeable analyst who verified that two rigs were going to be released by Coastal. (one of which was confirmed by Ensco in my article) In addition, he pointed out that rigs of more than one company are being turned over at lower dayrates. He was talking about companies with premium jackup rigs -- those that are able to drill in up to 300-350' of water-- that are being used in water depths of less than they are rated for... 200'or less. Pressure is on the companies who own those rigs to cut rates to compete with smaller rigs. To me, that's indication of softness, even if utilization rates remain high, and might mean lower rates of utilization in coming months, as drillers move those premium rigs to markets in which they can command top dollar. Ensco only told me that one of the rigs in question was rolled over at a dayrate in the high $60K range -- but citing a company policy not to disclose too much information about rigs and contracts, did not mention original rate. What definintely should have been included in that article was a little more context on utilization rates, both for Ensco, and the Gulf....will certainly keep that in mind when doing future driller stories. I do appreciate your comments -- feel free to keep in touch with any other thoughts... Regards, Mavis