Too good to be true!” That’s how one offshore service vessel operator recently described the red-hot U.S. Gulf of Mexico market.
At present, just about every available anchor handler, supply vessel and crewboat that is able to work is under contract. Day rates continue to move up, although at a somewhat slower pace than the past two or three months. Most expect rates and utilization to remain extremely strong in 2006.
Supply vessels up to 200’ in length posted a healthy day-rate gain of over $800 during December. Operators of large supply vessels reported high-end rates in the mid-$20,000 range.
Day rates for crewboats up to 125’ rose an average $475 per day over November’s figures. Small crewboats also recorded a healthy 3 percent utilization increase during December. Operators of larger crewboats also posted an increase, although not as big as the smaller units.
OSV operators are benefiting from a strong offshore construction market as oil-and-gas companies continue to inspect and repair platforms and pipelines damaged by hurricanes Katrina and Rita.
The Minerals Management Service (MMS) reported that over 27 percent of the Gulf’s daily oil production was still shut in at the end of December, and about 20 percent of daily gas production was shut in. Additionally, the MMS reported that more than 100 manned platforms remained evacuated at the end of 2005.
The outlook, when looking at the rig market, is mixed for vessel operators. Rowan’s jackups that were scheduled to mobilize to Saudi Arabia will begin moving there in January. Diamond Offshore will mobilize a jackup from the U.S. Gulf to Tunisia during the first quarter, and Noble Drilling will move a jackup to Mexico for a term contract with Pemex that begins in April.