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

To: Douglas V. Fant who wrote (19097)	4/15/1998 7:41:00 AM
From: marc chatman	Read Replies (1) \| Respond to of 95453

Doug, the ESV annual report gives me the impression that they are attempting to shift assets out of the GOM and to certain hubs around the world. I guess they look for areas where they can get some critical mass for their rigs so they can reduce servicing costs, sg&a, etc. It also sounds to me as though the producer often picks up the driller's cost to move the rigs. I don't know whether this includes some compensation for the days the rig is being moved and is therefore out of service (i.e., lost income). Do you know if that is the case? Perhaps you have pointed out a flaw in the Simmons Report. The perceived softening of dayrates in GOM will lead drillers to expedite the movement of rigs to international sites. In turn, that reduces the available rigs in GOM and pushes rates back up. I wonder how long this cycle takes to manifest itself.