It’s been a turbulent run following the May 2010 Macondo blowout in the Gulf of Mexico. But IHS says offshore drillers have shown their resilience by besting their more-muscular cousins, the “big four” major multi-service providers — including Baker Hughes, Halliburton, Schlumberger, and National Oilwell Varco.
John Parry is principal energy analyst at IHS. He says drillers are doing a healthy business providing replacements for offshore rigs, many of which are nearing retirement.
“Not only were they successful in contracting them, they were getting unexpectedly favorable day rates. That sent a very strong signal to the stock market that the offshore drilling outlook was very favorable going forward for at least the next two, three, or four years.”
Parry also says multi-service providers have overbuilt their capacity for hydraulic fracturing, or fracking, in North American shale plays. That’s led to price competition, driving down share prices.