A long wait for better days
With the oil price continuing to climb and Baker Hughes rig count showing a wavering but upward trend worldwide, there is a cautious optimism in the air, writes Ed Martin
As Westwood Global Energy group director Thom Payne told Rivieras Middle East Offshore Support Journal Conference in Dubai in May: We may have a while yet to wait before we see concrete signs of increased upstream activity. [But] we are starting to see a greater volume of offshore drilling projects being sanctioned around the world although drilling will not start for another 18 to 24 months so we are still a little bit off from that big recovery in global rig counts.
Offshore and subsea construction operators reliant on such projects know all about waiting. The maturity of pre-downturn projects and the scarce, lower-margin projects that accompanied the downturn are still taking their toll on balance books.
Some are anticipating better times, though, with Norway-based DOF Subsea choosing to tempt fate by adding Preparing for the recovery to the cover pages of its 2017 annual report and first-quarter 2018 reports.
In the reports forward-looking statement, the Norwegian companys board of directors noted that the market has continued to be challenging, adding that this may lead to reduced earnings and impairment of the non-current assets of the group.
The statement did, however, acknowledge ....