Last October, we looked at the soggy state of the jackup drilling market, as reflected in the fleet status of industry titan Transocean
Life hasn't gotten any easier for shallow-water contract drillers over the past 13 months, with the BP
In a September presentation, Transocean reported that it had "stacked" two dozen jackups. This means the rigs are not fully crewed or being actively marketed. As of mid-October, the company had 65 jackups in its fleet, so 37% of those rigs had no near-term prospects for work. A further two jackups were idle, and one of them has since been stacked.
In the same presentation, Transocean identified 12 more rigs that were working, but whose contracts were expiring before year-end. By my count, five are still working (or scheduled to, weather permitting), three are idle, and four are stacked. This suggests that fully half of Transocean's jackups are not working today.
This is all fairly grim. In case you're eyeing a sharp object on your desk, however, I will point out that there are still bright spots among so-called "high-specification" jackup rigs.
Transocean just recently agreed to purchase a fancy new jackup under construction by a Sembcorp Marine shipyard in Singapore. The price tag is $195 million, which is nearly 2.5 times the entire enterprise value of Seahawk, which has 20 "commodity" jackup rigs. This purchase follows a similar one involving Ensco
It's for this reason that Rowan Industries'
Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his CAPS profile or follow his articles using Twitter or RSS. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool owns shares of Ensco and Transocean. The Motley Fool has a disclosure policy.
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