Some of the negativity in the deepwater drillers is based on the assumption that some people are making that because of increased land drilling activity (shale oil, etc.), that customers of the deepwater guys will not pay the peak dayrates because they are allocating more money to drilling on land.
Do any posters have some in-depth knowledge about this?
This certainly does not seem to be true for the newbuilds which are getting top dollar and that's in brand new negotiations.
I think your concerns are valid. My concern as a fossil-fuel investor is that solar will continue to proliferate. If people don't need their houses heated/cooled with oil/gas/coal (solar panels) or their cars gassed up (b/c they have a plug-in electric), then we have real problems on this stock. Frac-drilling doesn't so much concern me at this point though.
I did end up talking with someone who works for APC. He said that APC takes a two-pronged approach, and that land drilling and deepwater drilling both have their place and always will....they both have a great ROI, and neither one is clearly better. Depends on the particular situation. He thought that the dayrates for the deepwater guys really depends on the supply demand equation over the near term. He really didn't give much credence to land drilling hurting the deepwater guys or pressuring dayrates very much.