More rigs plus slowing capex could cause North Sea pain for offshore drillers

|By:, SA News Editor

Falling North Sea dayrates has been one of the few bright spots for offshore drillers this year, but Credit Suisse expects the region to get hit come 2015, exposing Rowan (RDC), Seadrill (SDRL), Transocean (RIG) and Diamond Offshore (DO) to more pain.

More rigs in the North Sea combined with slowing capex point to a lot of question marks in 2015, Credit Suisse says; capex growth has been driven by the top players in the basin, which have raised spending ~17% annually over the last five years, but Statoil rig rental capex looks to be flattish this year and BP and Shell are set to spend less in the region.

RDC has the most exposure to the North Sea, with 32% of its revenue coming from the region, while RIG gets 26%, SDRL 18% and DO 17%.