Has anyone thought through the implications for the rigs that NE leases to Pemex given that it looks like Mexico will allow private oil back. I would think that this would be a positive as competition should allow for increases in dayrates as NE is no longer dependant on working out deals with Pemex given that Pemex has been difficult to deal with sometimes.
One more comment on the PEMEX deal, cut and pasted from BoA via seeking alpha:
The opportunity from Mexico's energy reforms could rival the Middle East and drive ~$2.5B of incremental annual revenues opportunity and bode well for top oil service stocks (OIH) that can do business in the Mexican market, BAML believes.
Mexico will be able to add 50 onshore rigs and 20 floaters within two years, the firm says, and the large oil services companies could generate an average ~$40M in revenue per rig in Mexico and other parts of Latin America.
Time to buy: BHI, CAM, ESV, NOV, NE, SLB, WFT.
It's probably a bigger deal in the mexican half of the Gulf, which has barely been worked. Just a few miles away on the US side it's been one of the busier deep basins on the planet.
So maybe if they put out bids on some of the shallow stuff, it''ll help the bidding for NE's shallow gear. But I think it's their inability to come up with the budget to go after the deep water stuff that's driving this. So, that's where I'd expect the first auctions for drilling rights.
This is good for all drillers, brand new areas opening up. It may end up just making up for Petrobras, which ironically seems to want to switch roles from being the best national oil company, to being the worst..... where PEMEX has had an unfortunate lock on that title for years. Brazil's current president is just clueless, at least Lula knew not to kill the golden goose.
Thanks Petro. I also wanted to congratulate you on what must have been a pretty good profit on your AAPL stock and put sales. I know I never would have, but I hope you kept your AAPL stock for some of this rally.