Rig Count

US: Land -55, Offshore -2(Gas rigs -4.7%, oil rigs -3.4%)

The count in United States is down by 520 rigs or 30% from last year.

Canada: -7

New Pemex Contracts

Pemex contracts three rigs for US$249.7 million

"Diamond Offshore subsidiary Mexdrill Offshore won contracts for two jackups. Ocean Nugget has been contracted for 849 days beginning April 11 for US$118.2 million. Ocean Summit, currently hot stacked, was awarded a US$70.3 million contract for 476 days, beginning July 31."

The dayrate for Ocean Nugget according to DO is ~135k, which is about 20% below the dr of the last contract.

CGGVeritas Q4

Revenues 766.8€ million (+27%)

Operating Income 148.2€ million(+13.6%)

Operating margin 19.3%(21.6%)

EPS 0.86€

Balance sheet

Assets
Current 1,728.4€ million
Total 5,634.2€ million(including 2,055.1 million of goodwill)

Liabilities
Current 1,003.2€ million
Total 2635.6€ million

Equity 2,960.1€ mllion

Outlook

"We currently expect that E&P spending will be reduced by around 10 to 15% in 2009. Outlook for seismic can be characterized by a softer market with low visibility especially in the second half. We are well prepared to manage these constraints by reducing our cost structure and adjusting our marine capacity.

Current global economic conditions should not lead us to underestimate underlying oil and gas fundamentals, which support the worldwide longer term need to increase reserve replacement rates and the efficiency of reservoir management. In 2009, while addressing carefully the short term uncertainties, we will preserve the ability to develop long term opportunities through technology leadership, the quality of our products and services and the value of the expertise of our personnel."

Q4-report

Ensco International Q4

Operating revenues 622.1 million (+20%)

Operating income 353.1 million (+22%)

Operating margin 56% (44%)

EPS 2.14 (+29%)

Balance sheet

Assets
Current $1,400.9 million
Total $5,830.1 million


Liabilities
Current $427.9 million
Total $1,153.2 million

Equity $4,676.9 million


Outlook

“We are beginning to be impacted by lower oil and gas prices, tight credit markets and the global recession. There is no question that 2009 will be a challenging year and that jackup rigs, including some of our own, will be without contracts for some portion of the year. Despite the challenging outlook, we believe our strong balance sheet, favorable contract backlog, conservative approach to internally funding our new rig construction program and the growing contribution from our deepwater fleet will provide Ensco a competitive advantage over the next several years.”

P/E 3.2
P/B 0.78

The report

Survive 2009, rake in the cash in 2010

"Rig-guru" Gavin Strachan of ODS-Petrodata predicts that 2009 will be a difficult year for offshore drillers but by 2010 the floater market will show great strength. Deep water day rates may fall, but as the supply/demand situation is tight it is possible that there wont be a decline in the rates. No new contracts have been announced recently and it appears that there is waiting game going on between the drillers and the E&P companies to see who can hold out longer.
The outlook for jackups and midwater floaters is far less bright.

Overlev 2009, håv inn i 2010

and

'Tough times ahead for land drillers'

also

North American rig market driven by deepwater demand

Alberta tightens oilsands water use rules

Upstream:

"Alberta is tightening the rules governing water use in the oilsands in what the province’s energy-industry regulator calls a “transformation” of the regulatory framework... "

"The province wants to cut overall water use by 30% by 2015."

This could give a big boost to Petrobank's THAI process.

-39

US rigcount falls by 39, Canada by 20. Today there are 471 less rigs active in the United States than there were a year ago.

FMC Technologies Q4

Subsea engineering outfit FMC Tech(FTI) reported Q4 on Monday:


Revenues $1,205.1 million (+12.6%)

EBIT $128.9 million (-0.2%)

Net income $91.3 million (+1.5%)

EPS $0.72 (+5.8%)

Order backlog(31/12/2008) $3,651.2 million (-19%)


Balance Sheet

Assets
Current $2,443.7 million

Liabilities
Current $1,962.5 million



Outlook

Peter D. Kinnear, Chairman, President and Chief Executive Officer: "We enter 2009 in the midst of an uncertain macroeconomic environment but with a solid base for future business. We expect the strength of our subsea backlog will help offset declines in our other businesses in 2009. Overall, we estimate 2009 diluted earnings per share from continuing operations to be in a range of $2.40 to $2.65."

P/E 9.5,

FTI looks expensive. A P/E in the range of 5 to 7 would be acceptable. The order backlog provides some visibility, but it only covers a years worth of revenues.

Acergy Q4

Revenue $567.9 million (-18%)

Adjusted EBITDA 135.1 million (-10%)

EPS(from continuing operations) $0.45(+2200%)

Backlog at the end reporting period

$2,511 million (-11%)

Balance sheet

Assets
Total $2,471.1 milion

Liabilities
Total $1,669.7 million

P/E 3.23, P/B 1.3

Dividend yield 4%($0.22)

Presentation(.pdf)

Transocean Q4

Operating revenues $3270 mllion (+57%)

Operating income $1084 million(-6%)

Operating margin 33%

EPS $2.50 (-40%)

Balance Sheet

Assets
Current $5.3 billion
Total $35 billion (goodwill $8.2 billion)

Liabilities
Current $2.7 billion
Total $18.6 billion

P/E 4.3, P/B 1.1(2.2 ex-goodwill, since that GW consists of the premium paid for GSF jackups(& other rigs) I would imagine that there are plenty write-downs ahead )
Link:
Transocean Ltd. Reports Fourth Quarter and Full-Year 2008 Results

Verenex deal done?

Pertamina Looks to Overseas Oil Fields to Boost Production:

"Among the planned acquisitions is a part of Canada’s Verenex Energy Inc.’s stake in Libya’s area 47 oil field. The area is estimated to contain reserves of 1.19 billion barrels of oil equivalent.

The firm expects to team up with China National Petroleum Corp. in securing the deal."

VNX ended the week on the TSX at C$7.74, which is likely to be near the acquisition price.

"The capacity that the oil industry has to go to 93-95 million barrels per day is already over"

World oil production potential weakening: Total

"The oil price collapse has weakened the industry's capacity to increase output and future production may top out at a lower level than earlier expected, the chief executive of major oil company Total (TOTF.PA) said..."

Total has been actively expanging in the Canadian oil sands, so I suppose you could say that de Margerie is practising according to his preaching.

Drilling related

Rigcount: US down by 60(10 oil, 50 natural gas, (4 offshore))
Canada down by 14

and

Cabinet likely to decide on oil drilling holiday next week

"NEW DELHI: The Cabinet is likely to decide next week on giving a three-year drilling holiday or moratorium on firms like state-owned Oil and Natural Gas Corp (ONGC) and Reliance Industries that are facing problems in sourcing drilling rigs because of the global scarcity...

Paper cuts

OPEC Members Carry Out 65% of Production Cuts So Far

"Members of the Organization of the Petroleum Exporting Countries (OPEC) have implemented nearly two-thirds of the production cuts of 4.2 million barrels per day (b/d) that they agreed to last September, an OPEC report showed Friday..."

Cutting production on paper is easy, the actual execution of the cuts seems to be difficult.

Noble Corporation

"Noble(NYSE:NE) is a leading offshore drilling contractor for the oil and gas industry. Noble performs, through its subsidiaries, contract drilling services with a fleet of 63 offshore drilling units (including five rigs currently under construction) located worldwide, including in the Middle East, India, the U.S. Gulf of Mexico, Mexico, the North Sea, Brazil, and West Africa."

Market value(06.02.2008): $7.46 billion(share price $28.48)

P/E: 4.87

P/B: 1.42

Yield: 0.56%($0.04/Q)

Revenues: 2008: $3,446 million 2007: $2,995 million 2006: $2,100 million 2005: $1,382 million 2004: $1,066 million

Operating margin 2008: 55.4% 2007: 49.8% 2006:44% 2005: 27% 2004: 18.5%

EPS 2008: $5.86 2007: $4.48 2006: $2.67 2005: $1.08 2004: $0.55

Balance sheet at 31.12.2008

Assets
Current $1.240 billion
Total $7.102 billion

Liabilities
Current $0.680 billion
Total $1.817 billion

Backlog at 31.12.2008: $11.5 billion, 31.12.2007: $6.7 billion

Fleet: 3 drillships (avg. age:28 years, all deep water units), 14 semi-submersibles(6 ultra deep water units), 43 jackups 3 submersibles.

Average rig utilization: 2008: 2007: 95% 2006: 96% 2005: 96% 2004: 85%

Competition(mcap): Transocean($19.06 billion), Diamond Offshore Drilling($9.38 billion), Seadrill($3.64), Pride International($3.23 billion), Ensco($4.06 billion), Rowan Companies($1.60 billion)

Customers(significant): Pemex, Shell, Petrobras, Chevron, Gaz de France, ExxonMobil

Acquisition/divestments: 2008: Sale of platform driling business value:$35 million

Shareholders: Barclays Global Investors UK 7.44%, FMR LLC 5.41, WENTWORTH, HAUSER AND VIOLICH 5.15%, VANGUARD GROUP 4.56%, STATE STREET 3.75%

Notes: Don't like the dividend policy, the company could and should pay a much greater portion of its profits directly to the owners. A real dividend instead of a token one would increase the valuation of the company by 10-30%.
The fleet is ageing and will require increasing capex. The relationships with national oil companies(Pemex, ONGC, QatarGas) can be a competitive advantage in the future as the newbuilds increase supply of rigs. The operating margin is at an unsustainable high, but I don't expect it to drop significantly before the end of this year. Fleet utilization is likely to fall aswell.
Overall NE looks cheapish(P/E, P/B, balance sheet, backlog).


Energy Current: Seasonal, economic factors affect offshore rig day rates

73 less

US rig count drops by 73(26 oil, 46 gas, 1 misc.), but the number offshore rigs is up by two. Drilling activity in the United States is now at a 4-year bottom.
Some have noticed a correlation between the price of oil and the Baltic Dry Index and assume that now the BDI has climbed to a three month high, the price of oil will follow up as did in the first half of '08. The BDI/oil price correlation was logical a year ago when the oil supply and demand situation was tight and the global dryshipping fleet is a significant consumer of oil. Today there's a big gap between the supply and demand. Inspite of the drop in drilling activity I still don't think that an equilibrium will be achieved before midsummer and that sustainable upticks are possible.

Obama: Energy an essential part of economic recovery plan

OGJ:

" The president said, "Finally, this plan will begin to end the tyranny of oil in our time. After decades of dragging our feet, this plan will finally spark the creation of a clean energy industry that will create hundreds of thousands of jobs over the next few years, manufacturing wind turbines and solar cells for example, and millions more after that. These jobs and these investments will double our capacity to generate renewable electricity over the next few years."

Reducing oil consumption and/or improving the efficiency of oil usage is essential in getting the American economy back on the of growth and sustainability. However a significant reduction in consumption will require changes that will be painful and will cause resistance.

FP:

"President Obama's New Energy for America plan probably will lead to significant legislation to combat climate change; a bad dream for Canada's oil sands industry"

Diamond Offshore Drilling Q4

Revenues $903.2 million (+35.4%)

Operating income $456.2 million (+59.4%)

Operating margin 50.5% (42.8%)

Income per share $2.11(+77.3%)

Balance sheet

Assets
Current $1.47 billion
Total $4.94 billion

Liabilities
Current $0.50 billion
Total $1.64 billion

P/E 6.9
P/B 2.7

The operating margin for high spec floaters in the fourth quarter was whopping 73%.

Drill and thou shall discover

Anadarko Announces Another Deepwater Gulf of Mexico Discovery

Helix hits pay in deep-water US Gulf

BP, RWE Confirm Additional Gas Pay at Offshore Ruby Field

National Oilwell Varco Q4

Q4

Revenues $3,810.2 million (+5%)
Revenue breakdown: Rig technology 55%, Petroleum services % supplies 37%, Distibution services 8%

Operating profit $856.4 million (+49%)

EPS $1.40(+33%)

Order backlog

31.12.2008 $11.1 billion, 30.09.2008 $11.8 billion, 31.12.2007 $9.0 billion

Year-end balance sheet

Assets
Current $9,595.1 million
Total $ $21,399.3 million(goodwill $5,225.0 million)

Liabilities
Current $5,626.6 million
Total $8,666.2 million

On outlook

"While near term economic conditions are challenging, we enter 2009 with a healthy backlog of equipment and technology to deliver to our customers, and a balance sheet with considerably more cash than debt. We believe that the oil and gas industry’s challenge to replace depleting reserves will require upgrading the world’s rig fleet, and we look forward to continuing to help our customers retool their rigs after years of underinvestment.”"

P/E 5.54(FY EPS $4.91)
P/B 1.12, 1.5 ex-goodwill

Press Release

The Grant Prideco acquisition, which was completed on 21. of April is the main reason for the jump in the profits. As a long term buy NOV looks very attractive.

Subsea 7 Q4

Q4 Numbers

Revenue $583.6 million (+3.7%)

Net operating profit $73.3 million(-8.6%)

Pre-tax profit 91.0 million (+12.7%)

EPS(diluted) $0.38(+5.5%)

Balance Sheet on 31.12.2008

Assets
Current 892.0 million
Total $2,012 million (goodwill $98.5 million)

Liabilities
Current $648.7 million
Total $1,313 million

P/B, with today's market value(NOK 5.4 billion=$772 million) 1.11, 1.28 ex-goodwill.


P/E on 2008 earnings($1.74) 2.9

Backlog
Global backlog of $3.3 billion on 31.12.2008, which based 2008 revenues is ~17 month worth of revenue.

Outlook

"Whilst the market outlook will retain a degree of uncertainty for the medium term as a result of the current economic climate, there has been no dramatic deterioration in the subsea market sector. Current indications are that National Oil Companies and major operators are generally maintaining spending levels. The recent announcement from Petrobras advising of a projected increase in Exploration & Production spending over the next 5 years from USD 65 billion to USD 105 billion supports this view.
However, as expected, the anticipated spending of smaller operators has been reduced and, as a consequence, a number of development plans have been re-evaluated and deferred. This has particularly affected the UK Sector of the North Sea (Norway remaining stable) and the Gulf of Mexico where a number of tie-back projects have been postponed.
There are indications of decreases in costs throughout the supply chain and, in conjunction with this, the Company is focused on reducing its costs and improving efficiencies in order to remain competitive in the current market."

Report(.pdf)

Brazil Oil Co OGX Seeks New York Trading For GDRs

DJ Newswire

"RIO DE JANEIRO -(Dow Jones)- Brazilian oil and gas company OGX Petroleo e Gas Participacoes SA (OGXP3.BR) asked local stock regulators Monday to approve trading in the company's Global Depositary receipts in New York..."

OGX's majority shareholder is billionare Eike Batista's EBX.
Unfortunately OGX's acreage in the Santos Basin is quite far away from the Tupi, Carioca and Jupiter discoveries, but the company definitely deserves a closer look.
A corporate presentation from December(in English).

Bioliq

GCC: Biosyncrude Gasification Process Could Produce Motor Fuel at Cost of Around $3/gallon

"The Bioliq biosyncrude gasification process (earlier post) used in a large plant with a capacity of > 1 Mt/a can produce biosynfuel for about €1.04 per kg or €0.8 per liter (US$3.08/gallon US), according to an analysis by researchers at Forschungszentrum Karlsruhe, Germany, which is co-developing the process with Lurgi..."

Lurgi is a subsidiary of Air Liquide(Euronext:AI)

Cost estimate for biosynfuel production via biosyncrude gasification(.pdf)

Air Liquide: Second generation biofuels: a new technological step

Catchy name, but an expensive process.