Hercules Offshore's Big, Shallow-Water Opportunity

With the recent drop in price of natural gas, shrinking margins forced so many onshore companies to shift their assets away from natural gas and focus on liquids, and the same phenomenon is happening offshore in the shallow-water sites in the Gulf of Mexico. This is a real benefit for Hercules Offshore (NASDAQ: HERO  ) , which is located primarily in the Gulf and whose jackup rigs are already positioned to take advantage of the big switch to a focus on liquids. This will help the company maintain its position as the leader in that space, which will drive up contract lengths and day rates.

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