GulfMark Offshore Inc. NEW (fka GLFMQ) (GLF)

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Floating rig day rates continue to rise
Filed from Houston
11/14/2008 6:00:37 PM GMT

Day rates for floating drilling rigs, including rigs rated for both mid and deep water, continue to rise, and this month are at record levels, according to ODS-Petrodata's Offshore Rig Day Rate Index. At the same time, rates in the troubled U.S. Gulf jackup market have given up gains made since mid-year.



The ODS-Petrodata Deepwater Rig Day Rate Index increased again, and now stands at a record 956. Three new deepwater drilling contracts for future work at rates in excess of $600,000 per day boosted the index to its new high, according to ODS-Petrodata's online RigBase market intelligence tool. Deepwater rig fleet utilization remains at 100 percent, and is expected to remain at this level for the foreseeable future, despite the recent slide in world crude oil prices. Any short-term slow down in the growth of worldwide energy demand is unlikely to put the brakes on deepwater exploration and development activity due to the long-term nature of the projects.



The ODS-Petrodata Mid-Water Depth Semisubmersible Day Rate Index also is at an all-time high at 1,111. Behind the rise are recent drilling contracts inked at rates in excess of $400,000 per day. Fleet utilization is unchanged at 97 percent.



The ODS-Petrodata U.S. Gulf of Mexico Jackup Day Rate Index slid to 364 this month, giving up gains made over the past four months. Lingering aftereffects of the stormy summer and uneven demand for shallow water drilling services in the region are likely to constrain U.S. Gulf jackup activity in the near term.



The ODS-Petrodata North Sea Jackup Day Rate Index increased slightly this month, continuing the pattern seen for many months now. Fleet utilization remains 100 percent, and little significant change in the market is expected in the near-term.



The ODS-Petrodata Day Rate Indices track the movement of competitive mobile offshore drilling fleet day rates and utilization for four rig categories. Day rates are charted as an index with the average market day rate in January 1994 equal to 100. Utilization is the percentage of contracted rigs out of the total competitive fleet supply. The data is updated on the second Friday of each month by ODS-Petrodata. Additional information is available from ODS-Petrodata in Houston, Aberdeen, Oslo, Dubai and Singapore.