North American rig market driven by deepwater demand

After last year brought record oil prices, the offshore oil and gas industry could have been forgiven for an optimistic outlook.

However, a worldwide economic crisis and oil prices slipping to less than US$50 per barrel have made 2009 a very different year.While the market for semisubmersibles and drillships in the U.S. Gulf of Mexico has remained fairly strong, the market for jackups has cratered. Facing jackup utilization of less than 60 percent, many drilling contractors are looking to move from the U.S. Gulf to Mexico to find work.So far unaffected by the downturn in activity, another four newbuild drillships and seven semisubmersibles are expected to arrive in the U.S. Gulf by the end of the year, all of which have firm contract commitments in place. Many of the newbuilds have deepwater capabilities, responding to the growing demand for deepwater activity in the U.S. Gulf.

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