This represents an example of the fact that immediate uploading of meeting notes may in fact be valuable to some audience . This meeting was on Tuesday afternoon . Note the opening comments ( which none of us pursued ) about the 'eventful' trip from TX . |THU.APR,960425,13:17| CNBC commented that Sonat was up 2 to 57 on merger w Norwegan Co .
| DDT |>| TUE.APR,960430,21:59 |
Note : I always use true proportions rather than percents , and in
ASCII , the APL uses the percent symbol '%' for division .
============================: TUE.APR,960423 :============================
16: NYSBC SonatOffshoreDrilling NYSE:RIG
|16:45| Ted : info pkgs ~ here yet |
\JeffChastain ; 713-871-7551 X:-850-3834 ; Sonat Offshore Drilling / Four
Greenway Plaza / Houston TX 77252 ; Dir Investor Relations .
FOR MORE INFO : firstname.lastname@example.org :
: eventful trip frm Houston , Chmn here momentarily , had to return .
SOnat OffShore drilling Mkt | > 3000ft |
15 rigs . 4th gen semi - NorthSea or > 5000ft |
in 5 mkts UK & Norway , Gulf , Brazil
Separate drilling ( or Integrated ) services : does fixed price well
drilling contract . vs DayRate | share risk w operator .
Rev 3 mo 3/31 81 70
106 Cash | assets 561 | debt : 30
Milestones : 1955 100ft 66 250 , 76 3500 , 78 4500 , 87 75 , 96 7600 ft
Is Premier co in busn . Alone > 7000 | only since Sedco 4x , in 80s > 5000ft
| 95 did all ( 8 > 5000 ft ) w 1 contractor .
Macro look @ floater busn - \/ - \/ - \/ - \/ - \/ - \/ - \/ - \/ - \/ - \/
WW # rigs : 140 from 180 in `86 , utiliation up to <= .95 |
most > 3k ft . most US. Gulf |
.4 offshore are explored | .95 x .6 |>| 0.57 | unexplored > 3Kft Deep |
Market Drivers : Reserve Opportunities , Tek Advancment - $ dn , speed up
; Lease expirations |
Reserve Opportuities : Gulf o Mex expect 8-15 , royalty relief on first
80+Mbarrels before tax for deep wells .
Brazil : Petrogas : 1.3 MB % yr by 2000 | they drilled Shell @ 5400ft Mensa
Emerging North Sea w Shell etc , W of Shetland & Ireland , edge of shelf
Only the 13 4th generation rigs can opperate yr rnd
3D seizmik cos , eg , Digicon , Input/Output : has lowered risk & cost
Horizontal extended reach drilling ;
SubSea completion Tek | platforms in N.Sea since `60s . floor sited
Shell 5400 ft 60 mi tied bac to shallow site . 300McFt gas
FPX/FPSO | cycle time - from lease to produce |
Lease Expirations redrilling |
292 115 21 ; fixed , < 3000 kft water
Deepwater progression . Dayrate increase . 93 95 96 w 40 60 117 | K$ 4thGen
10 yr hi floating utilization | Earnings leveraged on hi fixed costs .
Limited # rigs | leases extending from 1y to > 2 le 5 yrs |
8 Dynamically positiond Drill ships . % 3 of existing rigs spoken for thru
`99 | 50 - 100 M$ upgrades - Drill ship off Mobile AL , Sponsons to
increase flotation capacity . now in gulf drilling record well .
Conversions to 4500 ft water depth | rate 117K$ % day | cost of Cap le .12
12 mo quicker than to build from scratch .
NewBuild : Last cycle overbuilt , just outgrowing 70s-80s cycle
5-10 units unmet current demand ? > 200M$ cost depending on capability .
will require 3 >< 5 yr lease to justify @ higher rates .
Challenge : improve drilling process : goal .4 improvement : automating
Deepwateer presents long term Groth opportun lim by opers able to find
reserves , contractors abil to provide affordable drilling svcs .
Std 5 : Shell Exxon , Amoco , BP , ?
Sonat - good borrow
|17:28| ?s | FrankLay : bought some time ago . is happy . : NW coast of
Norwary StaatOil owned | WSJ article ? Shell > 15000 ? Mars - 3000 in water
( they did ) | tot record may be 25000 ft | gulf currents hell .
| Compititon ? DiamondOffShore Reading&Bates Transocian ( NorW ) |
MonaShields : howlong to recoup ? signd 1 4gen for |
E x\ reverse 2 356 110000 |>| 110K 39.2M 78.3M | contract day , yr , 2yr
Losses of rigs ? have ~ lost any due to weather . made to detach .
Smaller Jackup in egypt from early `70s sank under tow | all rigs insured
, this one @ 10 M for 3M book , so will record gain if totaled .
CapEx w be larger this yr | Indonesia etc ? ~ sinse late `70s
Amt of Seizmic going on is leading indecator of activity : implys w b big
activity in Asia | working w Pmex in bay of campecht .
Do supply personel .
Cost of production ? may be .35 - .4 of total cost of oil
even if day rate 2 x , would represent small fraktion of PV of project .
Earnings % Share | 95 : 1.65 , 1stCall proj 96 97 : 2.40 3.65 |
Quite predictable because based on set leases .
price @ yr hi : ~ 54 up from 20s .