Thank you for reading! This Substack is a place saver for a more formal website to sell niche, independent research on deepwater energy which is where I spend most of my time. I get valuable feedback from readers which helps me guide where I should spend my time. I appreciate your time reading — more to come and will still provide free content.
Thank you for reading. I am long this industry from a human capital perspective but independent regarding my investments which is by design. I promote my research and not my personal investments.
You mentioned 2H26–2027 for most multiyear project starts, is that all the way through 2027? Also contracts are usually awarded 9-12 months earlier is that correct?
This is very helpful and does a great job helping me (a frustrated equity investor in RIG) with some guideposts for timing equity purchases in the future! I am a believer in the cycle so it has been tough to live through all the delays with contracts and dilution
Thank you. I’m am outsider and speculating at the rationale. Good assets here that generate cash flows but it’s the bond holders that get them. I think some investors prefer to go to where the cash is going which is debt today, but if RIG is successful they can persuade investors currently in the debt to go for equity via more equity friendly indenture terms
I've been in and out of RIG since pre-pandemic. Opened around 1.60 and kept buying down to $1 or so then endured the drawdown into penny-stock territory and an eventual delisting threat. It reached the point where bad news would hit the wire *repeatedly* and the stock wouldn't budge. There was nobody left who was willing to sell.
Now chickenshit paperhand tourists are vocal and angry and I'm happy they're dumping. RIG's debt burden has always been the top reason to not invest. RIG is dealing with a slice of that burden and I'm delighted they're doing it with tourist money. I hope they do it again next year so I can back up the truck a 3rd time.
Outstanding analysis and very helpful. RIG is a multi-year investment that has enormous upside. If you believe that global energy demand is going to increase and land-based oil reserves, including shale plays, are at or near peak production, deepwater is the new frontier. I suspect we will have turbulent periods of global slowdown/recession, but the longer term looks very bright. It will be interesting to see how much OPEC can actually increase production.
Good summary, Joshua, and thanks for your attention. Volatility is inherent in this market but there is a positive LT outlook on demand. How that translates to investor returns in debt and equity is the big question.
I hear a lot of excited talk about "The Commodities Super Cycle has begun". This may well be true but the cycle will not be without interruption. I think there is going to be a major draw down in the general market in the not too distant future. Natural resource commodities will not be spared. After that the real commodity bull will begin in earnest. If I'm correct and RIG can make it through. It will make everyone's dreams come true. The most important consideration is time. Great article as per usual.
Grateful for all your writings on this space the past few years. Super helpful in spelling it out.
Curious Tommy - Why do you do this? (Says you have no positions) - What are you optimizing for?
Thank you for reading! This Substack is a place saver for a more formal website to sell niche, independent research on deepwater energy which is where I spend most of my time. I get valuable feedback from readers which helps me guide where I should spend my time. I appreciate your time reading — more to come and will still provide free content.
Interesting. Thank you for your work!
Do you not have any investment positions in the space at all?
Thank you for reading. I am long this industry from a human capital perspective but independent regarding my investments which is by design. I promote my research and not my personal investments.
That's fair.
You mentioned 2H26–2027 for most multiyear project starts, is that all the way through 2027? Also contracts are usually awarded 9-12 months earlier is that correct?
This is very helpful and does a great job helping me (a frustrated equity investor in RIG) with some guideposts for timing equity purchases in the future! I am a believer in the cycle so it has been tough to live through all the delays with contracts and dilution
Thank you. I’m am outsider and speculating at the rationale. Good assets here that generate cash flows but it’s the bond holders that get them. I think some investors prefer to go to where the cash is going which is debt today, but if RIG is successful they can persuade investors currently in the debt to go for equity via more equity friendly indenture terms
I've been in and out of RIG since pre-pandemic. Opened around 1.60 and kept buying down to $1 or so then endured the drawdown into penny-stock territory and an eventual delisting threat. It reached the point where bad news would hit the wire *repeatedly* and the stock wouldn't budge. There was nobody left who was willing to sell.
Now chickenshit paperhand tourists are vocal and angry and I'm happy they're dumping. RIG's debt burden has always been the top reason to not invest. RIG is dealing with a slice of that burden and I'm delighted they're doing it with tourist money. I hope they do it again next year so I can back up the truck a 3rd time.
See you guys at $20 RIG and $150 WTI.
Superb analysis thank you
Thank you for reading Shay
Thanks, Tommy, on point, as usual
Thank you for comment and also the link on your Twitter account !
Outstanding analysis and very helpful. RIG is a multi-year investment that has enormous upside. If you believe that global energy demand is going to increase and land-based oil reserves, including shale plays, are at or near peak production, deepwater is the new frontier. I suspect we will have turbulent periods of global slowdown/recession, but the longer term looks very bright. It will be interesting to see how much OPEC can actually increase production.
Good summary, Joshua, and thanks for your attention. Volatility is inherent in this market but there is a positive LT outlook on demand. How that translates to investor returns in debt and equity is the big question.
Excellent
I hear a lot of excited talk about "The Commodities Super Cycle has begun". This may well be true but the cycle will not be without interruption. I think there is going to be a major draw down in the general market in the not too distant future. Natural resource commodities will not be spared. After that the real commodity bull will begin in earnest. If I'm correct and RIG can make it through. It will make everyone's dreams come true. The most important consideration is time. Great article as per usual.