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Noble: U.S. Gulf, West Africa drilling markets slow to recover
Ray Tyson Petroleum News Houston Correspondent
Offshore contract driller Noble Corp., whose 2004 first-quarter profit dropped 28 percent compared to the same period last year, said April 15 that markets in West Africa and on the Gulf of Mexico’s continental shelf have been slow to recover, despite strong product pricing.
“While we believe the drilling markets overall will be highly volatile over the near term, the trend in activity should be positive,” said James Day, Noble’s chief executive officer.
The company reported 2004 first-quarter net income of $28.3 million or 21 cents per share on operating revenues of $245.4 million, beating analysts’ consensus by a cent. That compared to net income of $39.4 million or 30 cents per share on operating revenues of $245.0 million for the first quarter of 2003.
“Results for the first quarter … were adversely impacted by continued weak market conditions in West Africa and maintenance projects on the company’s drillships in Brazil,” Noble said. “These items were partially offset by solid performance in Mexico and the Middle East.” Day rates down, as are rig utilization rates Offshore revenues from deepwater drilling rigs capable of drilling in 4,000 feet of water or greater accounted for about 34 percent and 36 percent of the company’s total offshore contract drilling services revenues for the first quarter of 2004 and 2003, respectively, Noble said. The company currently operates seven deepwater semi-submersibles in the U.S. Gulf and one deepwater semi-submersible and three deepwater drillships offshore Brazil.
Offshore drilling revenues from international sources alone accounted for about 70 percent and 74 percent of the Noble’s total offshore contract drilling services revenues for the first quarter of 2004 and 2003, respectively.
The average day rate for the company’s international rigs was $52,713 in the first quarter of 2004 compared to $56,444 in the first quarter of 2003. Rig utilization decreased from 90 percent in the first quarter of 2003 to 80 percent in the first quarter of 2004. Day rate on domestic jack-up up 45% The average day rate on Noble’s deepwater rigs in the U.S. Gulf capable of drilling in 6,000 feet or greater decreased 3 percent to $110,322 in the first quarter of 2004, while utilization increased to 100 percent in this year’s first quarter from 86 percent in the first quarter of 2003.
The average day rate on the company’s domestic jack-up rigs was $41,292 in the first quarter of 2004, or 45 percent higher than the same quarter of 2003.
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