Source: Bloomberg
With high oil prices, rig rental rate and DEMAND have gone up phenomenally. The high rate is expected to stay strong beyond 2011. We could expect how positively this is going to improve the office (mainly energy and oil services companies) and industrial market in Houston and the growth be sustainable.
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Seadrill, the Norwegian oil-rig company set up by billionaire John Fredriksen, expects rental rates to increase and for the market to stay strong for at least the next three years.
“At this stage, the cycle is staying for quite a while,” Chief Executive Officer Kjell Jacobsen said in an interview in Oslo today. The market will be strong beyond 2011, he said, adding that the “deep-water sector is very attractive.”
Seadrill expects rig rental rates to increase to $700,000 a day, Jacobsen said. Seadrill got rates as high as $630,000 on an order from Brazil’s Petroleo Brasileiro SA in April, according to Stian Eliassen, an analyst at Carnegie ASA.
Seadrill, founded by shipping tycoon Fredriksen in 2005, owns 38 drilling units alone or with partners, of which 11 are under construction. The Bermuda-based company run from Stavanger said yesterday it will pay a first-quarter cash dividend of 60 cents a share, after a 25-cent dividend in the fourth quarter.
Jacobsen said that the company expects to announce new rig contracts in the “next quarter or two.”
Jacobsen said yesterday he’s stepping down for “private reasons” on June 1 and will be replaced by Chief Operating Officer Alf Thorkildsen.
Tags: houston, Industrial, oil price, Office, oil rig, rig rental, seadrill, houston economy
