Seeking Alpha

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

  • 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%.
Comments (15)
  • King Rat
    , contributor
    Comments (769) | Send Message
     
    Fear of pain = future drop in price = better entry point for me later.
    14 May 2014, 11:25 AM Reply Like
  • rvshaw
    , contributor
    Comments (102) | Send Message
     
    These guys write about the same stuff over and over again, all the while facts contradict what they say. Long $SDRL, and will add to my position on pullbacks.
    14 May 2014, 11:34 AM Reply Like
  • SafisKusai
    , contributor
    Comments (236) | Send Message
     
    This first bullet point is worded so terribly... the article states that dayrates have been dropping around the world HOWEVER the North Sea has been the one bright spot (AS IN THE RATES HAVENT BEEN DROPPING) but may come under pressure in 2015.

     

    The way its written now it makes it sound like falling rates are a good thing...
    14 May 2014, 11:34 AM Reply Like
  • tomlof67
    , contributor
    Comments (13) | Send Message
     
    I'll keep adding to my position each time SDRL pulls back below $35...selling puts for extra cash with strikes below $35, sweet!
    14 May 2014, 11:47 AM Reply Like
  • Chris Lau
    , contributor
    Comments (2059) | Send Message
     
    That's code for prodent investors to buy (SDRL)
    14 May 2014, 12:28 PM Reply Like
  • ross westgate
    , contributor
    Comments (165) | Send Message
     
    in 6 months they ll say 2016 is the slow down. meanwhile oil is up they cut costs and make profit. what do the anaylst want ffs
    14 May 2014, 12:32 PM Reply Like
  • 11146471
    , contributor
    Comments (942) | Send Message
     
    North sea is mature and declining.

     

    More dynamic plays come online globally as the time passes. North sea cannot be used as a benchmark!
    14 May 2014, 12:52 PM Reply Like
  • rvshaw
    , contributor
    Comments (102) | Send Message
     
    As in Gulf of Mexico and West Africa
    14 May 2014, 03:28 PM Reply Like
  • atk
    , contributor
    Comments (236) | Send Message
     
    South China sea too
    16 May 2014, 12:47 AM Reply Like
  • Brogembank
    , contributor
    Comments (20) | Send Message
     
    Just entered this branch of industry with moderate initial buys of both RIG and NE; both look rather undervalued to me and in any case, dividend rates of tehse two are far batter than the average reward for saving.

     

    if prices of RIG et al.. would drop further, I migt consider buying more!

     

    regards

     

    Brogem
    14 May 2014, 03:09 PM Reply Like
  • glf4mny
    , contributor
    Comments (389) | Send Message
     
    Oh crap! I forgot. They've discovered an alternative to fossil fuel. Which is????
    14 May 2014, 07:16 PM Reply Like
  • user 18159032
    , contributor
    Comments (668) | Send Message
     
    moonbeams
    14 May 2014, 09:23 PM Reply Like
  • Stock Market Mike
    , contributor
    Comments (2369) | Send Message
     
    No, silly - meet the QUANTUM ENERGY GENERATOR! *thunderclap*

     

    http://bit.ly/1nT1ozJ

     

    -Mike
    15 May 2014, 01:47 PM Reply Like
  • edgaraguzman
    , contributor
    Comments (10) | Send Message
     
    black gold • blue gold • yellow gold
    15 May 2014, 09:50 AM Reply Like
  • arthur_bishop1972
    , contributor
    Comments (2498) | Send Message
     
    More doublespeak from Nonsense, Inc.
    17 May 2014, 08:40 PM Reply Like
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