No way someone will buy VTG with 2.8 million in debt. Bragg needs to walk from Cobalt, and focus all energy on getting Platinium extended. VTG needs to oil to go to $20, and real production to get cut. It also needs drillers to massively scrap. Once production is cut, prices can stabilize. A shortage of drillships needs to be created as well, or this industry will become a mirror image of dry bulk. Dry bulk has been wiped out.
ZD is right, that is why VTG is priced for BK. Dream call would be if we walked from Cobalt, Plat was extended, and titanium was actually drilling. Titanium is the one asset that could save VTG. Bragg has no business buying Cobalt, unless he finds a partner would gets us great financing terms.
Diamond just booked 4 newbuilds for $400k in the November/December 2014 timeframe. Nearly the same specs as Cobalt.
I am assuming 400k for Cobalt, and 350k for Platinum. Bragg needs to find a partner for Cobalt, as we can not take that debt alone.
2016 is the question, and whether we can make debt payments. I think Cobalt is the wild card. I don't see how we take that ship on. Any insights on the Su ruling today?
Oil $50 offshore drilling will come to a halt. That is why VTG is priced to go out of business. Offshore drillers need to scrap, and start their own cartel. Too many drillers out there.
We need production to be cut, nobody is cutting production. More importantly we need offshore drillers to scrap rigs, and a ton of them. Let's face it at $40 there will not be a lot of offshore drilling period. Too many rigs are out there. No reason to take on Cobalt, walk away or find a majority partner.