The total number of offshore rigs under contract this week is unchanged since last week. However, the number of rigs contracted rose by one rig over the last two weeks, since the last time we published the Weekly Offshore Rig Review.
We took last week off from publishing the Rig Review to prepare for the RigLogix Users' Meeting held last Friday. And this week we're back with some of the information that was covered during that session. In particular, we focused on the deepwater (4,000'+) semisubmerisble market, which we will be looking at today.
The Current State of the Deepwater Semisub Fleet
At this time, the deepwater semi fleet consists of 54 rigs, 50 of which are currently under contract. One of the four rigs that are currently not contracted, the Noble Paul Wolff, is set to go on contract within the week. The other three non-contracted rigs are undergoing repairs and upgrades, and all have contracts lined up for when the rigs leave the shipyard.
Of the currently contracted deepwater semis, 40% of the fleet (20 rigs) is working in the Gulf of Mexico. Another 20% of the fleet (10 rigs) is working offshore West Africa. And 9 more deepwater semis are working in the waters offshore Brazil. The North Sea is the last major region for deepwater semis, with 5 rigs currently working there. The other rigs are spread around the world in Australia, SE Asia, South America and the Mediterannean.
The Deepwater Semisub Contract Backlog
At this time, only 5 deepwater semis will be available for new contracts within the next 12 months. Looking an additional year out into the future, another 17 rigs will be available from a year to two years from now. So, that means that during the next 2 years, only 22 of 54 semisubs (40%) will be available to start new contracts at any point during that time. Conversely, 32 of 54 semisubs (60%) have contracts that will keep them working for at least the next 2 years.
New Semisubs Entering the Market
This high level of demand has prompted the construction of 16 new deepwater semisubmersible rigs. The soonest any of those rigs is likely to be delivered is the end of 2007, with the majority of the new semis (11 rigs, 68%) scheduled to be delivered during 2008.
The Forecast for Semisub Utilization
Thanks to a new forecasting model, we can now provide a forecast for future utilization within this segment (and others). Looking forward to 2008, we expect to see deepwater semisub utilization remain above 90% into the first quarter. After that, as newbuilds quickly begin to enter the market and global oil supply and demand adjust, utilization is likely to begin declining to 41 of 72 available rigs at the start of 2009, which is just below a 60% utilization rate. Deepwater semisub utilization will remain between 50% and 60% for all of 2009.
For more information about this forecasting model, you can download the following PDF files, which provide details about the model and its results:
Slides from Presentation Given at RigLogix Users' Meeting on March 3rd
These slides provide a brief overview of this new forecasting model, its developers, its applicability, and its results for the deepwater semisub fleet. The slides only provide a portion of the information from the presentation, so if you are interested in learning more, please let us know. 118kb PDF file.
RigOutlook for 4,000ft+ Semisubmersible Demand
This 23 page report provides the details of the deepwater semisubmersible forecast, along with supporting appendices that provide details on statistics used to build the model. 310kb PDF file.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit www.riglogix.com.