Pacific Drilling SA (PACD) operates four ultradeepwater drill ships for a blue-chip customer base, and they have four more rigs scheduled to be delivered in the next two years, standing out as the purest play on ultradeepwater with the newest fleet in the industry, says John Keller, Vice President in Equity Research at Stephens Inc.
“They have four ultradeepwater drill ships that they are operating today: two with Chevron (CVX), one with Total (TOT) and one with Petrobras (PBR). PACD is a very young company with a blue-chip customer base,” Keller said. “When all is said and done, you’ve got a company that’s growing very appreciably over the next several years.”
Keller says deepwater is one the themes gaining traction in the coming years, and offshore drilling is occurring all over the world now, not only in what was previously considered the core markets. Keller highlights geographies like East Africa, Southeast Asia, Australia and the North Sea, as well as the U.S. Gulf of Mexico as regions seeing drilling for resources.
“As I said earlier, there is a global proliferation of deepwater, and I think the companies with new assets are going to be very well-positioned, for efficiency and safety reasons. There are few small-cap ways to gain exposure to the ultradeepwater sector, so Pacific is a good company that fits a niche in the marketplace and in investors’ portfolios,” Keller said.
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