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

To: P.Prazeres who wrote (25520)	7/11/1998 12:05:00 PM
From: Captain James T. Kirk	Read Replies (1) \| Respond to of 95453

Friday July 10, 5:53 pm Eastern Time Iran didn't agree to Riyadh pact terms - Quiros CARACAS, July 10 (Reuters) - Alberto Quiros Corradi, a top Venezuelan oil adviser, said Friday that Iran didn't agree with the ground rules of the Riyadh pact to cut oil output and he suspected they were breaking the agreement for that reason. Quiros, who was a key member of Venezuela's team in the Riyadh talks, said Iran didn't agree that cuts should be made from real production, but rather from its OPEC quota, which was higher than its production level. ''In Iran, one could talk of violation because the real point of departure of its measures was not the one agreed to,'' he told a local radio station. ''Iran was always reluctant to accept the rule that the cut should be measured from real production instead of quotas...It so happened that Iran was producing less than its quota so they wanted to go back to the concept of quotas and, of course, everyone opposed that.'' Quiros, who despite his seniority in Venezuelan oil circles is neither a staff member of state oil company Petroleos de Venezuela (PDVSA) nor a Ministry employee, said he, therefore, suspected that Iran was violating what it had ostensibly agreed with other members of the Organization for Petroleum Exporting Countries (OPEC). ''I suspect, and it is only a suspicion, that they are ignoring the real production agreement and measured their cut from a higher level. That could represent about a 200,000-barrels-per- day (bpd) difference,'' he said. Although it had an official OPEC quota of 3.942 million bpd, Iran agreed in March to cut by 140,000 bpd from its real output level, which was established at 3.623 million bpd. Venezuela's state oil company Petroleos de Venezuela (PDVSA) and the Energy and Mines Ministry have given mixed signals about its compliance with its commitment. On Monday, PDVSA President Luis Giusti said Iran broke the agreement by 230,000 bpd, and he was backed up by PDVSA first vice president Claus Graf, who confirmed the figure. But Energy and Mines Minister Erwin Arrieta contradicted them Friday, saying he had no evidence of violation. Iran emphatically rejected Giusti's accusation on Wednesday, blaming the current crisis in oil markets on Giusti and asking him not to rely so much on ''secondary sources'' for production data. In the Riyadh pact, producers agreed to use secondary sources as the measure of production, since governments have used false data in the past. In its monthly survey of OPEC oil output, Reuters found that Iran produced 3.72 million bpd in April, 237,000 bpd above the level agreed in the Riyadh pact. Quiros said that Iran's non-compliance, added to a 400,000 bpd increase in Iraqi output, which wasn't included in the Riyadh pact, meant that OPEC's declared 1.245 million bpd cut from April only removed about 500,000 bpd of oil from the market. After the Riyadh pact failed to lift oil prices significantly from their 10-year lows, OPEC agreed in Vienna, following preliminary talks in Amsterdam, to another set of cuts, bringing the group's total agreed cut to 2.6 million bpd. ''I hope the Amsterdam agreement that starts on July 1 will have an effect on the inventories during August and that in September we should start to see a small recovery in prices, and this should become more apparent in October, November and December,'' Quiros added.

To: P.Prazeres who wrote (25520)	7/11/1998 6:21:00 PM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

Parker Drilling Conference Call - 1st Driller release/market impressions... Dayrates & Utilization: US Land Rigs --- utilization at 71% - dayrates at $8545 versus prior quarter of 76% utilization and dayrates of $8705. They are seeing some softening to $8,000 and see some additional utilization and dayrate softening possible. International Market Land Rigs --- 70% utilization @ $15,979 versus prior quarter at 75% utilization & $15,272 dayrates. Barge Drilling --- Deepwater, Intermediate depth and International Barge segments at 100% utilization with stable dayrates -- deep @ $18,817 vs. $19,646; intermediate @ $13,346 vs. $14,978; international $27,726 vs. $26,290. They were especially positive on this segment and stated that they have very limited competition (FLC). Jack Ups --- 67% utilization (4 of 6 rigs) dayrate average of $27,175 versus last quarter of 100% (6 of 6) and dayrates of $28,555. Parker expects 1 jack up to be on contract any moment and emphatically stated that there is'' NO freefall'' in GOM jack up dayrates. They are just now seeing increased jack up activity. They additionally stated that they have an opportunity under an ''umbrella'' created by deeper-water ''Premium"" jack ups moving into shallower natural gas oriented jack up markets; in that they could underbid substantially these ''premium rigs'' and that they did not expect to lose as much business as the market had expected in relation to the movement of the premium jack ups into shallow water... (this bodes well for CDG and perhaps MDCO with their alleged ''cheap, rusty old - but low cost rigs'' - not my terms or PKD's, but in reference to prior posts commenting on CDG & MDCO's ''junk'' rigs in the GOM). Overall PKD has 71 of 101 ''marketed'' rigs under contract. All stacked rigs are in ''warm'' status. 3 rigs in construction/repair and 21 cold stacked rigs. Mallard and Quail Oil tools divisions very strong. They commented on the strong Deepwater & International markets. They were especially positive on the South American market and specifically spoke enthusiastically on Columbian projects by Harken & Seven Seas. They are positive on Caspian Sea & Kazakhstan's future. International, Deepwater and Land Rigs in Central/South America America are very strong - good news for land drillers with strong presence in these markets... Also mentioned that they see the change in Government in Nigeria as a positive - and are positive on the Nigerian market as well as most International sectors.Expect recovery in Indonesian geothermal drilling as well. They acknowledged some additional softening in Land Rig Dayrates are coming, but seemed very confident in the stability of GOM Jack Up dayrates and actually are just now seeing increased activity in the GOM Jack Up market - this was a major positive from what I was expecting. No surprise from the strength in Deepwater & International markets, Barge drilling was perhaps the best sector dayrate and utilization-wise... They do expect to see Earnings down in the next quarter from this quarter, but they and the Drillers in general; are expecting a rebound in the fall and perhaps a surprisingly strong Q1 1999. This paints a much more positive picture than the analyst revisions and the media had portrayed in my opinion. While we are NOT back to the high flying days or rates of last fall - the bottom is NOT in freefall and we now know what dayrates & utilization rates are - I feel driller stocks are way oversold in respect to these numbers and Parkers overall forward looking expectations. The upcoming additional earnings releases if they concur with PKD will be very good news for the oilpatch IMHO... note to PKD longs; Parker is extending depreciation life of their land rigs from 10 to 15 years and will take $1.3 Million a quarter for this in FY 1999 going forward. They have $110 million in liquidity ($35 M in cash and a $75m credit line) for acquisitions in International, Deepwater or Oil Tools.