Transocean Seeks to Boost Oil Production in Artic
The following commentary comes from an independent investor or market observer as part of TheStreet’s guest contributor program, which is separate from the company’s news coverage.
NEW YORK (Trefis) — Transocean(RIG) is the world’s largest provider of offshore drilling services for oil and gas wells. It competes against Diamond Offshore(DO), Hercules Offshore(HERO), Seahawk Drilling(HAWKQ), ENSCO International(ESV) and Rowan Companies(RDC). Transocean also operates one of the most modern and versatile mobile offshore drilling fleets in the world that can function in challenging environments such as the North Sea. We have a $85.70 price estimate” for the company, which is roughly at a 36% premium over its current market price.
Push Towards More Exploration in Norway
Norway is the largest producer of oil and gas in Western Europe, producing around 230 million standard cubic meters of oil equivalents in 2010. However Norway’s status as one of the world’s leading producers of oil is being threatened by the rapid declines in oil production from its mature wells. The discovery of resources has lagged production ever since 1997 and this is leading to a steep reduction in the remaining reserves. The oil industry contributes to 25% of the country’s GDP. Tokeep the sector from declining, the government of Norway is encouraging offshore explorations in its northern territories. Norway expects new oil and gas finds in the Barents Sea region of the Arctic to offset some of the decline in its oil and gas output. This region could hold close to 6 billion barrels of oil that have yet to be discovered. The recent discoveries by Statoil(STO) in the Barents Sea have fueled new interest in exploration activity in the Arctic regions of Norway, leading to record levels of drilling in 2011, with four additional wells planned this year and seven more in 2012. The Norwegian Petroleum Directorate expects investments exploration and production costs to keep increasing through 2013, which will directly result in higher revenues for providers of offshore exploration and drilling services. The settlement of the border dispute with Russia has also boosted exploration efforts. As of February 2011, Transocean had five of its units drilling in Norway. Earlier this year Statoil contracted semi-submersible “Transocean Leader”‘ over the next three years to carry out drilling at depths below 1,500 meters. Only rigs with very high specifications can operate in the demanding climatic conditions of the Arctic.
dsi vida guerra julia stiles scholarship us airways trailer master chef