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

To: Winkman777 who wrote (45039)	5/19/1999 4:42:00 PM
From: rich evans	Respond to of 95453

The refusal to comment on 2000 could be interpreted positively as the estimates are pretty low as I recall.With the return of oil prices, Rig may be able to finess the major storm damage based on its long term contracts and then new contracts after the worst of the storm has passed or just going with some temp /short term contracts making 2000 better than forecasts made using low rig prices. But maybe I don't understand the industry well enough : Anyway I am in for more at 25. And added to FGI as well. "A glutton for punishment" Rich

To: Winkman777 who wrote (45039)	5/19/1999 4:44:00 PM
From: RealMuLan	Read Replies (1) \| Respond to of 95453

Brazil's Petrobras Cancels $127 Million Drilling Contract With R&B Falcon Petrobras Cancels $126.5 Mln Contract With R&B Falcon (Update1) (Updates with analyst's comment in 3rd, 4th paragraphs.) quote.bloomberg.com Houston, May 19 (Bloomberg) -- Petroleo Brasileiro SA, Brazil's state-controlled oil company, said it canceled a $126.5 million drilling-rig contract with R&B Falcon Corp. after the U.S. company couldn't complete the rig's renovation on time. Petroleo Brasileiro, known as Petrobras, said it canceled the four-year contract for the Falcon 100, expecting it can lease another rig for less for its Barracuda field off Brazil. Petrobras also said it could use its own equipment, since it expects to use fewer rigs in the Barracuda field than it estimated. Low oil prices have cut demand for rigs and reduced rental rates. New rigs often take longer than expected to build, and many oil companies are now using the delays to get out of contracts and save money, said Byron Dunn, a Warburg Dillon Read analyst. Last month BP Amoco Plc canceled a contract with R&B Falcon, the fourth-largest U.S. driller, because of delays in a $270 million rig upgrade. ''It's a pervasive problem in the industry,'' said Dunn, who rates R&B Falcon shares a ''buy.'' Petrobras also canceled a separate $9.4 million contract with R&B Falcon for well analysis and other services, said Petrobras's Jose Coutinho Barbosa, director of exploration and production. R&B Falcon didn't return calls to comment. In a U.S. Securities and Exchange Commission filing this week, the company said Petrobras might cancel the contract, though R&B Falcon said it didn't have the right to do so. The upgrade of the Falcon 100 is expected to cost about $118 million, nearly double the original estimate, R&B Falcon said in an SEC filing. The work, which was to be completed by January, is now expected to take until the end of June, the company said. R&B Falcon said in the filing that it faced $14.7 million in late-delivery penalties under the Petrobras contract. Petrobras, Brazil's biggest company, lost more than $900 million in the first quarter, wiping out all of last year's profit, as Brazil's currency devaluation sent the value of its dollar debt soaring. Shares of Houston-based R&B Falcon, which are down more than 65 percent in the past year, fell 1/16 to 10 in midafternoon trading. Rio de Janeiro-based Petrobras fell 3 reais to 2556.