Hurricanes impact US Gulf drilling activity, but market conditions are strengthening

摘要

THERE MAY BE some mixed signals emanating from the US Gulf of Mexico E&P and drilling market lately, but overall the region appears to be at its strongest ever in terms of rig demand and dayrates as a result of manmade and natural events. In mid-October, the Gulf rig count was at its lowest in nearly a year, while at the same time dayrates were increasing significantly, resulting from a rig supply that had dwindled by about 10 units due to storms and 4 to 5 more that would be exiting the Gulf to other regions. Additionally, a rig-sharing consortium agreed to charter a newly constructed ultra-deepwater semisub-mersible for four years. The new rig won't be delivered until 2007. Meantime, the US Gulf is still reeling and trying to recover from two back-to-back Category 5 hurricanes that swept through the middle of the Gulf's densely populated oil and gas producing areas. As a result, the Gulf's entire production of oil and natural gas was shut in, and in mid-October, more than a month after the first storm, Hurricane Katrina, and several weeks after Hurricane -Rita, nearly 65 percent of oil production and 52 percent of natural gas production remained shut in, primarily as a result of damaged refining capacity, although several major offshore producing facilities were severely damaged or destroyed during the hurricanes, as well as several offshore pipelines.