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

To: Peter Weinman who wrote (25999)	7/19/1998 9:42:00 PM
From: Slide Rule	Read Replies (1) \| Respond to of 95453

Peter, as you "follow GLM closely", I'd appreciate your thoughts on how they will fare over the next few months, at least compared to other drillers. TIA

To: Peter Weinman who wrote (25999)	7/19/1998 9:52:00 PM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

Interesting Industry Report by - TheOil Industry Research Group: Per my reference to a cover story article in today's Parade magazine concerning the coming dramatic increases in worldwide oil demand due to the expansion of the under-industrialized world (does anyone really, sincerely doubt this coming demand?)... here is an interesting ''Industry"" conference position on the impending demand not just for oil but the equipment and Rigs that will be needed. ...amazing how many of these a ''dime a dozen'' INDUSTRY comments are out there ! ''stolen'' from appropriately enough - ''The Motley Fool'' RIG board: '' In this week's issue of World Oil they had an article entitled: Outlook for oil services industries? Gushers! To sum it up, the companies in the oil service sector of our industry that survived the devastating depression of the past 15 years or so are going to get very good news. This is according to the Oil Service Industry Research group of the highly esteemed Simmons & Company International. In a recent report, this Houston-based investment banking firm called attention to the fact that the oil service industry today is as tight as an industry can get, with virtually every aspect of the business out of spare capacity. Backlogs are soaring for rigs, seismic crews, logging units, supply boats and most other products. Matthew R.Simmons, president of the company, told a recent National Ocean Industries Association meeting that, over the next ten years, his analysis indicates production will have to increase by 42 million bpd to meet expected demand. The cost to add that much new production would be roughly $2.5trillion. With the oil service industry currently out of spare capacity, it will need to expand even more to meet that demand. An additional 450 offshore drilling rigs would be needed to achieve what Simmons calls "rig equilibrium." The cost of those rigs including deepwater rigs, semis and jackups, would be around $88 billion, at today's prices. That number would increase to $123 billion assuming 5% annual inflation, plus an additional $12 billion for offshore service vessels and another $12 billion for drilling equipment. Simmons concludes, "It is clear that the industry is going to need a lot of money to finance expansion, and that the winners and losers will be determined by who gets the right mix of financing sources."ÿ Stay Foolish and prosper, :) TMF Spirit, Motley Fool chat hostess, every market day'' ****************************************************************** who'd of thunk it ? ...dramatic increases in the demand for crude and also hey !; we'll need more Rigs , pipe and equipment to supply it ! Bog Dog; What is the single biggest buzzword in the entire OILWORLD right now ? I don't know if you ''broker'' Rigs worlwide or not, or how much contact you have with the International - ''Majors'' but without dispute - with no close 2nd place subject; THE topic in the Oil business worldwide is ----- The Caspian Sea; ... the Tengiz & South Caspian Sea oil fields are not just ''the'' number 1 topic in International Oil, but one of the hot spots for international politics. Their reserves are equal to the entire Persian Gulf & North Sea reserves. China, Russia and the former Soviet Republics along with Iran...gee; we've had a lot of politically positive spin control on Iran recently haven't we ??? coincidence ? Are the hotbed now - how many times do we need to read about SLB's Russian presence etc.. True, this area, especially Russia, is in its infancy market-wise. But we are very close due to Russia's financial crisis of them ''surrendering'' their tangled political web of graft and corruption to the leadership of an International Consortium of Big Oil to complete this project. The International politics have all ready started concerning drilling rights and proposed pipelines to both International ports and also China. If anyone has a long term perspective; 3-5-10 years; read what China has spent allready -- $4 Billion to develop E&P and $3.5 Billion for a pipeline to China. Read the links on HLX and their expansion into a huge joint venture with a China Boat/Fab yard ... this is happening right now - US companies are expanding into ''International'' ,markets to offset the GOM weakness etc. This International growth demand simultaneously coupled with a crude oil price rebound and the resulting upswing in US markets will drain current capacity for equipment, pipe, Rigs and people. The Caspian Sea's mature offshore drilling market will exceed the GOM ! International companies like EVI, SCSWF, CXIPY, International Seismic players like PGO or VTS and Fab companies like FGII, HLX and equipment companies like VRC and International Drillers will all prosper... the future is not only very bright for a worldwide crude oil demand increase but an increase worldwide for Rigs and equipment -- this article sure does NOT make me worry about future dayrates ! I'm not talking 6-12 months here; all though companies like HLX are all ready reaping financial benefits today as we speak ! I believe HMAR is there as well... It's going to happen...how many articles, studies etc. does it take to get peoples attention ? We will see a demand explosion unrivaled in the history of Oil ...only time will tell; as well as reward those with enough foresight to beat the crowd to the party....