Summary
Many offshore contractors have a hunch their future success might be tied to the deepwater market. The smart ones know it is.
Analysis
There currently exists a lull in offshore E&P activity and some would have us believe the oil & gas industry has no future but, it's not all doom and gloom.
Drilling contractors, ENSCO International Inc, are clearly confident that deepwater oil & gas is developing into what will become a long term growth sector for them . ENSCO has invested some $3 billion into a deepwater rig building program and have secured some significant deepwater drilling contracts for those rigs.
The deepwater business is not without its risks of course and it is not an activity that tolerates fools gladly but contractors who have the resources, capability and foresight for the deepwater will reap substantial rewards in the years ahead.
Other deepwater drilling contractors such as Noble Corp(NYSE: NE), Transocean Inc(NYSE: RIG), are also set to take advantage of the opportunities that lay ahead in the deepwater plays.
