Transocean: Total Backlog Likely To Be Down Sequentially Despite Impressive Contract Win

Summary:

  • Last week, Transocean reported an impressive contract win for the harsh-environment semi-submersible rig Transocean Equinox.
  • Including mobilization and demobilization fees, the rig’s dayrate should be well above $500,000, a number not witnessed for almost a decade in the harsh environment floater space.
  • While Transocean has demonstrated substantial progress on the semi-submersible front, the company has not reported a single drillship award in recent months.
  • As a result, net backlog addition in the upcoming July fleet status report is likely to be negative.
  • While shares remain expensive based on a number of key metrics when compared to U.S. exchange-listed competitors, I would use any major weakness to initiate or add to existing positions as the industry outlook remains strong.

The semi-submersible drilling rig Transocean Leader with anchor handler vessel Balder Viking alongside.

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Note:

I have covered Transocean Ltd. (NYSE:RIG) previously, so investors should view this as an update to my earlier articles on the company.

Last week, leading offshore driller Transocean Ltd. or “Transocean” reported an impressive contract win for


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