Wednesday, October 31, 2012

More Bullish Comments from Various Offshore GOM Services Firms ($CNRD)

Hercules Offshore Management Discusses Q3 2012 Results - Earnings Call Transcript

"Any operator looking to have an active drilling program in the U.S. Gulf of Mexico shelf needs to realize that we may be short in jackups in 2013 if current market conditions persists.[...]
"A meaningful number of jackups have left the competitive fleet in recent years. Since the year 2000, the industry has delivered 139 new builds. Over the same period, the global marketed fleet has only risen by 58 rigs, suggesting that some 80 rigs have been lost, stacked, scrapped or sold out of the business during the past 12 years."
Oceaneering International Management Discusses Q3 2012 Results - Earnings Call Transcript
"Specifically, in the U.S. Gulf of Mexico, we are expecting 2013 demand for our service and product lines that support deepwater drilling to surpass the level we experienced before the Macondo incident in April of 2010. We are also projecting Gulf of Mexico demand for our non-drill support service and product lines to improve, but not to the pre-Macondo level. In our view, this level may not be reached for another few years due to the time lag between drilling and subsequent field development activity

"And I think before Macondo, there was a fair amount of, let's say, smaller independents that were operating in the Gulf of Mexico, and they would typically have relatively fast turnaround, single or double well projects, where they would get -- they would -- from discovery to production might be 2 years or something on that order. Whereas today, we see very little of that activity, and it's much more predominantly the majors who are operating in ultra-deepwater, where you've got multiple wells and a complex production scenario to work through and develop, and that planning process and the procurement for floating production equipment and all the rest of it has a much longer timeline, and so that's typically a 5-year idea, from discovery to development. It could be as long as 7. But I think for the Gulf, it would probably more closer to the 5-year range. So that really is what we're talking about. And given that people have just started drilling, let's say, a year ago and finding these prospects. It could be 4 or more years before it really starts happening. We just recently bought an -- update our market forecast for the Gulf of Mexico only by Quest. And according to what they gave us, they said subsea tree installations in the Gulf are not expected to reach the prior peak level of 2008 until 2016."

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