Tuesday, June 3, 2014

Why Seadrill Ltd's Deal Russia Is a Huge Opportunity


Alert investors shouldn't be all that surprised that despite a weak offshore drilling market, a Seadrill Ltd (NYSE: SDRL  ) subsidiary signed a landmark deal. In this case, relatively new spin-off North Atlantic Drilling Ltd (NYSE: NADL  ) reached a large deal to work with Rosneft, a large Russian energy producer. The deal was significant enough that Vladimir Putin is raising some red flags about its long-term validity.

North Atlantic Drilling is a pure-play, harsh environment firm with eight offshore rigs and a focus on the North Sea in Norway and now the Arctic Shelf aspirations of Russia. The company has a ninth rig under construction with a delivery date of 2015 and a likely destination of the Russian Arctic. The harsh environments of the Arctic are expected to contain vast amounts of energy resources, and North Atlantic Drilling happens to have a young fleet focused on the sector.

Read the full article here.


Disclosure: Long SDRL. Please read disclaimer page for more details.

No comments: