Recently, offshore drilling giant
) issued a monthly 'Fleet Update Summary' covering the company's
drilling rig status and contract information.
Per the report, the company's high specification jackup GSF
Constellation I received a three-year contract from
) to work on Indonesian waters. The contract is executable from
October 2012 at a revised dayrate of $150,000, against a prior
dayrate of $140,000.
Another drillship - GSF Monitor- won a one-year contract from
Nigerian Petroleum Development Company to operate in the offshore
region of the country. The rig is expected to work from August 2012
at a current dayrate of $153,000, up from the prior dayrate of
Transocean's midwater floater GSF Rig 135 received a 120-day
contract and will operate in the waters of Nigeria. The rig was
) at a dayrate of $340,000, higher than the previous dayrate of
The company is currently involved with the construction of two
rigs - Deepwater Asgard and Deepwater Invictus - that are expected
to be operational in the first and second quarters of 2014,
respectively, after necessary trials and enlistments.
However, two jackups Roger W. Mowelland Transocean Nordic have
been sold, and hence will no longer be part of the company's
Leading offshore drilling contractor and the provider of
drilling management services globally, Transocean's current
contract drilling fleet comprises 129 mobile offshore drilling
facilities that include 50 high-specification deepwater floaters,
25 midwater floaters, 9 high-specification jackups, 44 standard
jackups and one swamp barge in support of offshore drilling
activities across the globe.
We are maintaining our long-term Neutral recommendation on the
stock. Transocean currently retains a Zacks #3 Rank, translating
into a short-term Hold rating.
We acknowledge that Transocean is the industry leader in deep
sea drilling. The company's state-of-the-art mobile offshore
drilling fleets worldwide can function in almost every challenging
However, we apprehend that operational issues - such as the
decline in utilization rates and high operating costs - along with
a high debt level will likely continue to weigh on the stock.
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