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  • More Reasons To Believe In Gold [View article]
    Really? China and India together are buying significantly more than the entire world's annual production of gold. Add Russia into the mix and demand substantially exceeds production.
    Apr 9, 2015. 05:33 PM | 9 Likes Like |Link to Comment
  • More Reasons To Believe In Gold [View article]
    I agree, at the moment, the paper gold market does indeed control the price. I'm not sure how much longer that will be the case though.
    Apr 9, 2015. 04:26 PM | 3 Likes Like |Link to Comment
  • Analyzing The Impact Of The West Sirius Rig Cancellation [View article]
    I believe that was for the West Taurus and West Eminence.
    Apr 3, 2015. 11:17 AM | Likes Like |Link to Comment
  • Seadrill's Strong Cash Flow Provides Confidence In Ability To Handle Debt [View article]
    I've been seeing the same info. The banks don't want the company to fail and with the difficult conditions in the industry, they would rather help out.
    Mar 31, 2015. 11:49 AM | Likes Like |Link to Comment
  • A Few Reasons To Avoid Investing In American Shale Oil Companies [View article]
    As of the time of the writing of this article, North American shale oil was trading at $37 per barrel. Seeking Alpha took a while to publish it.

    I agree, the Saudis can't afford to maintain their production at current levels indefinitely. I think they're trying to hold out long enough to kill shale oil producers and whatnot.

    My point with this article is that many shale companies won't be able to withstand this for too long without either diluting shareholders or going bankrupt.
    Mar 25, 2015. 07:05 PM | Likes Like |Link to Comment
  • Seadrill's Strong Cash Flow Provides Confidence In Ability To Handle Debt [View article]
    Agreed, NADL is a bigger problem near-term than SDRL is.

    I suspect that the backing of NADL's debt was an attempt by SDRL to allow NADL to refinance its debt at favorable terms since the potential termination of the Rosneft contracts could pose problems.
    Mar 25, 2015. 07:01 PM | 2 Likes Like |Link to Comment
  • Seadrill's Strong Cash Flow Provides Confidence In Ability To Handle Debt [View article]
    SDRL's bonds are currently trading at junk bond levels. The company's bonds were yielding 11.69% last time I checked over the weekend.

    But Seadrill does a few options available to it that some investors haven't considered including private placements. I sent Seeking Alpha an article about that this morning which hasn't been published yet.

    In the meantime, there's been no evidence that banks are refusing to continue to support the company at reasonable terms.
    Mar 25, 2015. 06:59 PM | 1 Like Like |Link to Comment
  • Seadrill's Strong Cash Flow Provides Confidence In Ability To Handle Debt [View article]
    The attractive thing is that many of its competitors have much older rigs that they'll be scrapping. SDRL may emerge with a much higher percentage of its current fleet intact.
    Mar 25, 2015. 06:55 PM | Likes Like |Link to Comment
  • Seadrill's Strong Cash Flow Provides Confidence In Ability To Handle Debt [View article]
    SDRL has already stated that it may consider delaying the delivery of rigs that it has not already gotten contracts for. Sevan Drilling (Seadrill's subsidiary) has already done this with its newest rigs. I think that's a definite possibility if it needs to take that step.

    The West Navigator actually doesn't have that big of an impact on SDRL itself. It's more of a problem of NADL.

    The contracts with Rosneft were always a risk, yes. Rosneft has frequently stated that it was committed to drilling in the Arctic, even if it had to delay its contracts for a while. I'll admit, that I'm beginning to question those statements, but that is a bigger problem for NADL than for SDRL, even if SDRL does consolidate NADL's results into its own.
    Mar 25, 2015. 06:54 PM | 2 Likes Like |Link to Comment
  • Pacific Drilling Is Well-Positioned To Weather The Industry Downturn [View article]
    Not exactly sure why my response to this got erased, but here it is again. Yes, I did mention some of the negatives of the company in a previous post. I've been trying to provide balanced coverage of the stock so that people can see both sides of the story and make their own decision. So yes, I mentioned in my previous article that revenues, cash flows, and EBITDA are likely to decline going forward. I make the same statement in this article.

    All the charts above assume that the Meltem and Khamsin will not get replacement contracts and also assume that the Zonda will not get one.

    As for the company's debt… so far the fears that the drillers will be locked out of the credit markets haven't materialized. But, the reason why dividends and other plans for returning capital to shareholders have been reduced is that the drillers themselves are worried about that. I've made the same statement multiple times in past articles about PACD and other companies in the industry (especially SDRL).
    Mar 24, 2015. 05:50 PM | Likes Like |Link to Comment
  • Pacific Drilling Is Well-Positioned To Weather The Industry Downturn [View article]
    Yes, I did point out the negatives in an earlier article, I wanted to follow it up with one that mentions the positives. I pointed out those same negatives in this one. I said that cash flow, revenues, and EBITDA are likely to decline over the next two years in both this article and the previous one.

    As you mention, the company does have the Meltem coming off contract without a replacement one and the Khamsin goes off contract in December. All of the figures presented in this article are with the assumption that the company will not find new contracts for those rigs (nor for the Zonda).

    All I said is that the company would weather the next two years. Unless customers start outright canceling contracts, that looks to be the case.
    Mar 24, 2015. 05:33 PM | 1 Like Like |Link to Comment
  • Is Europe Now Assisting China In Reducing The U.S. Dollar's Dominance? [View article]
    You misunderstand. There is no attempt to create a currency union nor create a new currency. The alternative system is one in which there is no reserve currency and trades between nations are settled using the currencies of both nations involved.
    Mar 18, 2015. 03:58 PM | 4 Likes Like |Link to Comment
  • The Stock Market Has Disconnected From Economic Reality [View article]
    Historically, anytime the Shiller PE went over 25, a market crash did follow within a relatively short period of time, but I'm not so sure how long it'll take. There's an old saying that the market can stay irrational longer than you can stay solvent.
    Mar 6, 2015. 03:38 PM | 6 Likes Like |Link to Comment
  • North Atlantic Drilling: First Impressions Of The Company's Results [View article]
    Well… for what it's worth…. there's expected to be about 400 billion barrels of oil in the Arctic. That's 25% of the undiscovered oil in the world. There's only 8-10 rigs in existence that can drill in that environment and many of them belong to NADL.
    Mar 4, 2015. 08:55 AM | 2 Likes Like |Link to Comment
  • North Atlantic Drilling: First Impressions Of The Company's Results [View article]
    The environment for harsh-environment rigs in general has declined. Statoil has been reducing the number of rigs that it has in Norway and many other companies in the area are following suit. The oil companies in the West were having problems with their cash flow prior to the oil price decline and now that oil prices are much lower, those problems have been exacerbated.

    North Atlantic Drilling said that it's trying to find work for West Navigator so let's see how it goes.
    Mar 3, 2015. 09:26 AM | Likes Like |Link to Comment
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