Specialist
Former VP at Ensco Inc
Agenda
- Incentive price level requirements for rig demand to increase
- Rig count trends in Q4 2020 and 2021 outlook
- Day rates outlook – utilisation of jack-ups and floaters by region
- Industry impact of bankruptcies
Questions
1.
There have been huge reductions in rig numbers over the last year, presumably sparked by the oil price crash at the start of 2020. Could you outline that reduction in rig numbers across regions and across different types of rigs?
2.
What has been happening to rigs with respect to cold or warm stacking?
3.
What do you think 2021 could be like? There seems to already be some recovery with respect to rig count in the Permian Basin. Some oil price bulls are expecting prices to recover by another USD 15-20 per barrel by the end of 2022. What are your expectations for rig count? Where do you think rig count could be added to? Do you think this will still be a story of national oil companies opportunistically adding long-term contracts? Or do you think there will be some private sector additions as well?
4.
What has happened to day rates over the last couple of years? What do you think could happen next year?
5.
On the supply side, a couple of players are going bankrupt. How do you think oil producers will react to that? You mentioned a story where one company didn’t want to go further on the day rate because it became questionable whether it could run a good rig. Do you think the oil producers will want to increase day rates just to help the rig industry? Or do you think some majors will try to acquire at opportunistic prices?
6.
You mentioned that there need to be changes on the supply side to increase day rates again. Do you think any kind of M&A activity would be enough, or do you think capacity would need to actually exit the market?
7.
Do you have any thoughts on which players could pair up with which? Or is this still so up in the air it’s not worth trying to project?
8.
Do you think there has to be a wave of scrapping throughout the industry?
9.
How much do you think the active fleets would need to reduce by to increase utilisation and day rates? How much are you predicting for 2020? Will 35-40 scraps be converted? How many more years of a similar rate do you think there will need to be before day rates start to go up?
