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Oceaneering Gets Vessel Right

Zacks Equity Research

Global oilfield service provider Oceaneering International Inc. (OII) struck an agreement with marine transportation and offshore services company, Otto Candies LLC, for the right to use the Cade Candies – a multi-service subsea support vessel – for a period of five years. However, none of the companies disclosed the financial aspects of the transaction.

Manufactured in 2010, the U.S. flagged vessel is approximately 309 feet long and is designed with a Class 2 dynamic positioning system, a helideck, a 150-ton active heave compensated crane and a working moonpool. It also provides accommodation facility for about 69 staff.

Houston, Texas-based Oceaneering holds a rolling, short-term charter on Cade Candies from November 2011 onwards and will exist till early 2013. During this phase, the vessel will be upgraded with superior features at the shipyard. The vessel’s modifications include two, high-specification, work class onboard ROVs (Remotely Operated Vehicles) along with a high-quality satellite communications system.

Following the changes, the revamped vessel – renamed Ocean Alliance – is expected to work for Oceaneering from the second quarter of 2013. The company will operate the vessel in the ultra-deep waters of the Gulf of Mexico and enhance its subsea intervention services in the region.

Oceaneering, along with its subsidiaries, is engaged in providing engineered services and products mostly to the offshore oil and gas industry, with a focus on deepwater applications across the globe. The company also serves the defense and aerospace sectors with its applied technological skill.

Oceaneering will release its third-quarter 2012 results on October 29, Monday, after the closing bell.

The Zacks Consensus Estimate for earnings in the third quarter is 79 cents per share, on revenue of $731 million.

Oceaneering, which extends its services to oil biggie such as BP plc (BP), currently retains a Zacks #2 Rank, implying a Buy rating for one to three months.

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