Aramco rollercoaster
For the offshore drillers, the capital markets’ interpretation of Aramco-related news over the past few days appears to be mirroring the rollercoaster on the offshore planned amusement park in Saudi Arabia, ‘The Rig’. In this note, we summarise the recent Aramco commentary and events, along with our perspective. From a ‘direct impact’ viewpoint, it is key to understand what companies may face suspensions and/or see rigs released. For an ‘indirect impact’ perspective (for the international jackup market), it is critical to understand the ownership, technical specification, and timing/phasing of any rig reduction that could impact contractors’ behaviour to bid for rigs outside the region. In sum, solid demand elsewhere could absorb surplus jackups, but bidding discipline from local Middle East-based contractors in international markets will be vital. For investors, we sense continued uncertainty related to the Aramco situation until there is more clarity on the number of rigs being suspended or potentially released, and we expect many investors to stay on the sidelines. We believe any volatility could present a buying opportunity for long-term investors seeking jackup exposure.
Diamond Offshore Drilling provides contract drilling services to the energy industry around the globe. The company's fleet enables it to provide services in the floater market on a worldwide basis. The company's contracts to provide offshore drilling services vary in their terms and provisions. The principal markets for the company's offshore contract drilling services are: the Gulf of Mexico, including the U.S., and Mexico; South America, principally offshore Brazil, and Trinidad and Tobago; Australia and Southeast Asia, including Malaysia, Indonesia, Myanmar and Vietnam; Europe, principally offshore the U.K., and Norway; East and West Africa; and the Mediterranean.
Odfjell Drilling Ltd. (Odfjell Drilling) is an integrated offshore drilling and oil service company. The Company operates through three segments: Mobile Offshore Drilling Units (MODU), Drilling & Technology, and Well Services. The Mobile Offshore Drilling Units is responsible for operations of mobile drilling units fully or partly owned by the Company and units owned by other companies. It operates mobile drilling units in Norway, United Kingdom, Angola, Vietnam and Brazil. The Drilling & Technology segment is providing platform drilling, project management and engineering services. Drilling & Technology operates from offices in Bergen, Stavanger and Aberdeen. The Well Services segment is a provider of casing and tubing running services (TRS), drill tool rental and well intervention services to the onshore and offshore oil and gas industry. The Well Services are provided to onshore and offshore drilling operations in the North Sea, mainland Europe and Black Sea, among others.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.