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

To: Aggie who wrote (43065)	4/23/1999 12:53:00 AM
From: iandiareii	Read Replies (1) \| Respond to of 95453

Aggie On today's RIG cc, Talbert made clear that RIG will stack -- cold or hot -- rather than work below cash break even. Approximately seven rigs bid a Terra Nova job, including two of Transocean's, and RIG refused to bid below six figures. Talbert also said that Transocean's contingency plans include cold stacking, thus "demanning" the rig, as he so delicately put it. Once cold stacked, Talbert said, rigs will not then return to service merely for operational break even precisely because of the stacking costs you cite. I don't know how Transocean field workers feel about today's news, but, strictly as an investor, I liked a lot of what Talbert had to say. He refuses to be pushed around in a depressed pricing climate that he expects to be relatively short-lived. That's not to say that the office folks won't work with the E&Ps, only that nobody is in business to lose money, and jobs that promise to do just that are largely unacceptable. He's on record now, if it were ever in doubt: RIG will bend, is open to creative suggestions and will actively pursue every job prospect, but negotiations will proceed with the understanding that, no, that's not a barrel, and you don't have us over it, anyway. RIG's world-wide business relationships and sterling reputation should ensure that deals will continue to be reached at terms favorable to both parties -- as they should be -- or they will not be reached at all. I think all concerned realize that in the current environment no one can afford burnt bridges. This co. is the best in the business at what they do, and it took quality personnel throughout to reach that status. You could hear the respect for RIG management in the analysts' voices as they participated in today's call. Management had best work to ensure that their employees, no less deserving of respect, remain secure in their jobs through the coming months. I think that Talbert's firm comments today will contribute to that effort. What a monster quarter Transocean had, and all involved should be congratulated. RIG proved again that they are the lead dog, and the only view any other co. will ever get is the brown-eyed wink. These tough times could end as soon as this autumn, and I wish all you patch folks good luck in the meantime. Look for FY00 earnings estimates to be raised soon. ian