A Review of the Nigerian Energy Industry

Transocean suffers quarterly drop

Balder Viking by Transocean Arctic27 February 2014 – Swiss-based Transocean has suffered a 49% fourth quarter drop in profit on the back of higher costs and a drop in revenue.

The company posted fourth quarter net income of $233 million compared to $546 million in the third quarter.

This drop coincided with a drop in revenue from $2.55 billion in the third quarter to $2.33 billion in the fourth quarter thanks to lower fleet utilisation and decreased revenue efficiency, partially offset by higher dayrates.

Fleet utilisation was 75% for the quarter, compared with 83% in the previous quarter because of out-of-service time as well as idle and stacked rigs, while revenue efficiency was hit by control equipment downtime on ultra-deepwater rigs.

Operating and maintenance expenses increased by $41 million to $1.5 billion in the fourth quarter, primarily due to shipyard and maintenance costs, while general administrative costs jumped in quarter-on-quarter results.

For the 2013 full-year, Transocean booked a net income of $1.4 billion.

Transocean’s full-year results were hit by costs from the Macondo well incident, impairments on assets up for sale and losses on the sale of Shelf Drilling preference shares.

These were partially offset by discrete tax benefits, gains from asset sales and income from discontinued operations.

2014 fleet revenue efficiency guidance has been set at 94% while operating and maintenance expenses are predicted to be between $5.2 billion and $5.4 billion.

Capital expenditure is expected to be about $2.6 billion.

Since 16 January, Transocean has booked more than $66 million in new contracts and has predicted out-of-service time will be 15 or more days.
*Bianca Bartucciotto – Upstreamonline

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