So their assessment earlier in the year was off, so they change it. They can be expected to revise it monthly and it can go up or down. They don't know, they just throw data into a program and see what comes out. That data is swiftly changing and economic stimulus is being considered by the G20 and China specifically to get things going faster.
And that is NOT a shipyard. They make drilling equipment and land based rigs mainly. They are collaborating on a semi sub as their first project. The terms call for a price of $320 million not including the equipment supplied by Orion.
Their fleet will be highly sought after for UDW where there is GROWTH as many older rigs will be cold stacked and probably broken up. New regulations all around the world to prevent Macondo-like disasters will force companies to use state of the art rigs like SDRL owns and operates. That includes their jack ups as well as their floaters. A year and a half from now they will likely be making 30% more per quarter than now as rigs arrive, some already with contracts, and the shift to younger state of the art vessels continues.
Oh, and they have backlogs at most first class yards stretching a good three years for all kinds of different vessels. Tankers, bulkers, box ships, lng carriers, on and on….
Then the rig would be towed back to European waters. This is pretty much a non-issue being blown way out of proportion.
"Analysts Channel NewsAsia spoke with say the global offshore and marine sector is coming off its peak last year, and with current conditions, it looks unlikely to pick up until at least a year later. However, looking ahead, they expect competition from China to ease as oil-rig builders there focus on delivering orders, rather than acquiring new ones. With world oil demand expected to continue on its upward trend, they add that long-term prospects for the industry still look strong."
About what the SDRL CFO says. Late next year contracts will likely be sufficient and ramp back up in rates. The trick is to get several well type contracts for the short term then sign multi year contracts when rates rebound in a year or so. The profits are strong on UDW rigs with expenses and cap costs of about $275k for a new build UDW vessel.
The article you meant to paste was about the effect on the builders of the rigs as orders stop. This is a natural reaction to a short term glut that will likely be remedied by older rigs being removed from service. SDRL is getting inquiries for 2015 at this time.
"The ice-free window for drilling is said to last from August to mid-October, thereafter the plan was to tow the rig back to European waters."
So the early shut down is two weeks earlier than planned.
You do also seem to miss the sanctions on Russia, the departure of a long term board member and the Kara Sea drilling stoppage that was going to happen anyway as the ice builds up.