Infill Thoughts

An important tone shift in how Halliburton addressed investors Wednesday morning foreshadows a different type of recovery ahead. Reading between the lines, we’ve dubbed the upcycle of the future a “roll up your sleeves” recovery. What will oilfield companies have to do to achieve prior KPIs in the recovery ahead? We discuss that and more… There’s …

Recent financing news from several large offshore drillers suggests that it is becoming more difficult for the battered sector to access the capital markets. With a wave of credit instruments approaching maturity over the next 3-5 years, the sector’s collateral ($100bn worth of newbuild rigs) is increasingly economically impaired (paybacks periods are …

Saipem won 30 years of new land rig backlog in Saudi Arabia today. In the US, we estimate about 28 rig-years of land drilling backlog have been added in total since the bottom. We compare the Saudi and US drilling markets, and estimate backlog created in the young and tender recovery. …

A quick round-up of three stories flying below the radar that we find important lessons in: i) a leading indicator of Norwegian mature field development just plummeted, ii) H&P just paid an injured rig hand $72mm, and iii) Patterson-UTI is finding it easy to return idle land rigs to work. …

Latin American deepwater exploration and development is largely driven by the two large NOCs in the region. Here lately, these NOCs have been slamming the brakes, particularly in Brazil where Petrobras is trying to recover from scandal that rivals Enron. Both NOCs are pruning their rig portfolios, resulting in negative demand for Latin American floaters. …

In news from Rowan Thursday afternoon, we observe drilling contract negotiations taking a different kind of turn. The usual dayrate, duration, and specification sticking points that operators and contractors haggle over are expanding as deal-makers seek creative solutions to downturn problems. Exclusivity is being granted by an operator in exchange for more favorable early-termination release. …

This may sound a little bit counter-intuitive, but bear with me: Patterson-UTI’s acquisition today signals that its build vs. buy strategic preference remains in tact. That’s because Patterson acquired a rig technology company this morning even though hundreds of idle land rigs are for sale as cheap as 15 cents on the dollar of build cost. …

Anadarko made a big splash on Monday afternoon, announcing the $2bn buyout of Freeport McMoRan’s deepwater GOM assets. It’s a big deal for the GOM and for Anadarko’s position in the GOM. But what we found most interesting about the announcement is how Anadarko spun the deal into an onshore growth narrative. …

Halliburton and its peers may share a common outlook, but they sure do differ on oilfield service strategy. Jeff Miller got a little chippy Tuesday, throwing some jabs at Schlumberger and other oilfield service firms as he described Halliburton’s advantages. We discuss Halliburton’s punches thrown, and review other important takeaways from Jeff’s talk. …

The Barclays investor conference held in New York the week of Labor Day marks the start of the year-end news rush. A hot item at Barclays was a basic truth about the oil market: failing to offset natural declines will push oil prices higher every time. Today’s capex starvation is setting up tomorrow’s feast. There’s …