With overbuilt and weakening deepwater rig market, looming unrecognized Macondo litigation exposure, pending likely adverse Norwegian tax ruling and potential (likely?) Icahn unloading, this may soon fall into a bottomless pit. Worst case scenario is just above above ground zero IMO.
With overbuilt and weakening deepwater rig market, looming unrecognized Macondo litigation exposure, pending likely adverse Norwegian tax ruling and potential (likely?) Icahn unloading, this may soon fall into a bottomless pit without support until the $20s.
..run, Forrest, run!
Monthly revenue is around $800MM.
Adding $66MM in a month is massive shrinking.
Do the math.
next SEC form 13 may show that he is reducing the position. He has a mole on the Board and is smart enough to abandon a sinking ship. The industry is tanking and oil spill liability exposure is far greater than most recognize.
Well said, but don't forget it is only a matter of time before the hammer falls on the Macondo oil spill liabilities and the risk is far greater than most realize.
I believe the industry has overbuilt and has added too much capacity.To keep all the existing and newbuild floating rigs working, rig charter spending would have to increase by 14%-18% a year for the next three years. That will not happen as deepwater rig operators are reducing spending. Ergo, utilization and rates will come under severe pressure.
The Drilling Contract only covers claims “FOR POLLUTION OR CONTAMINATION, INCLUDING CONTROL AND REMOVAL THEREOF, ….”
By way of comparison, the Cementing Contract covers “ANY CLAIM OF WHATSOEVER NATURE ARISING FROM POLLUTION OR CONTAMINATION ….”
Ergo, the Drilling Contract Indemnity can be interpreted as applying to claims for “pollution or contamination” to the exclusion of economic loss claims!
You just don't get it.
The pollution indemnity has more holes in it than a Swiss cheese and BP will not seek indemnity from RIG, but contribution for the BEL payments which are not "LIABILITY FOR POLLUTION OR CONTAMINATION" under 24.2 of the drilling contract.
The end is near!
That would make it worse.
If you are correct, Class counsel will have a field day punching holes in the drilling contract subsea pollution indemnity that will be so big they will be able to drive a fleet of loaded Brinks trucks through them.
Macondo liabilities will devastate RIG as the drilling contract subsea pollution indemnities have more holes that a Swiss cheese.
Meethinks Carl will bail soon. Stock is around his basis and he has Merksamer as a mole on the Board.
The biz is about to tank with the overbuilt offshore rig industry and RIG's Macondo litigation exposure is gigantic.
Run,Forrest (i.e., Carl) RUN!