RIG - Earnings call transcript Q1 2024

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Operator

Good day, everyone, and welcome to today's Q1 2024 Transocean Earnings Call. [Operator Instructions] Please note this call is being recorded, and I will be standing by if you should need any assistance.It is now my pleasure to turn the conference over to Allison Johnson, Director of Investor Relations.

Alison Johnson

Thank you, [ Shelby ]. Good morning, and welcome to Transocean's First Quarter 2024 Earnings Conference Call. A copy of our press release covering financial results, along with supporting statements and schedules, including reconciliations and disclosures regarding non-GAAP financial measures are posted on our website at deepwater.com.Joining me on this morning's call are Jeremy Thigpen, Chief Executive Officer; Keelan Adamson, President and Chief Operating Officer; Mark Mey, Executive Vice President and Chief Financial Officer; and Roddie Mackenzie, Executive Vice President and Chief Commercial Officer.During the course of this call, Transocean management may make certain forward-looking statements regarding various matters related to our business and company that are not historical facts. upon to and certain based therefore, assumptions, are subject are risks statements current certain expectations and Such and uncertainties. cause could factors actual differ to Many materially. results Please that could forward-looking our future for information refer certain impact SEC for regarding uncertainties and more our and risks results. to our statements filings to question-and-answer and please comments, Mark's Also, duty we that session forward-looking revise will company the or note a with prepared team. our statements.Following no conduct undertakes update Jeremy, Keelan,

to will speak, give initial to to more the opportunity to follow-up.Thank participants time, call limit this one please an question you During yourself very now over one and much. Jeremy. I turn

Jeremy Thigpen

Thank employees, call. customers, you, on our today's welcome participating Allison, to investors and and analysts

EBITDA drilling of adjusted million million in of resulting approximately margin $XXX revenues, $XXX earnings As the reported first adjusted yesterday's on contract an for XX%. of release, adjusted in EBITDA quarter, delivered Transocean

of pace with terms. for the this demand somewhat moderated year, semisubmersibles While extremely last environment drillships awards time and lengthening contract harsh day rates remains ultra-deepwater from high-specification has and improving strong

agreement, units, not the of Control Blowout approximately of Pressure the in included estimated blow-out or fact, a extension is Asgard will lump total expected announced additional Deepwater commence million million.As preventers is K-BOS. backlog the the which operator The XXXX XXX-day an June part The rigs' value contract direct approximately Kinetic payment, continuation $XXX million Mexico. $XX.X recent this and the program earlier in be included and independent of for Stopper the with sum with of $XXX month, in to contract program of services. U.S. In upgrading a Gulf we includes we

is BOPs. device highlighted, capability K-BOS blow-out to is existing we retrofittable improves sharing that previously As a preventer and

of any and emergency it which depths wellbore the significantly feeling of minimum sharing in of less are facilitates to disconnect, an rig second. time complete tubular than operating the expand water floaters. the the device deepwater Certain capable X the Importantly, ability for to configurations also shortens the

Kinetic several as with Pressure proud past Safety the with K-BOS third unit approval. and their worked we I'm the that development to to closely and the Bureau fleet. Environment as this report BESI, Control Over regulator, will have and the And support of testing that years, of Transocean or to Enforcement, earn mark introduced has our well

just a of Deepwater to for are work encouraged and additional Gulf and our technology.Also current are U.S. from wells signed increased to positive to this of the $XXX,XXX its we expected transformational an continuation the received the a contract see customers Atlas feedback on of XX,XXX per BESI We X and XXX in XXX pay program days. between an at day by in pleased willingness from day last customers for rate Mexico, of direct our

TotalEnergies remaining Deepwater exercised We the $XXX,XXX its option on also Skyros at announced per day.

which below TotalEnergies. before beneficial well to option, is recent negotiated rates, our mutually the most this was While relationship pleased are current acceleration, market continue and with we long-standing market materially

tightness awarded of factors at improved market.Healthy months, move day supply/demand supporting reflecting numerous are long-term recognition increasing next participants' through we to be many dynamics. As we of in expect durations rates several one the the industry contracts contract the

quarter, a XXXX something of days award, average with contract new robust TotalEnergies' largely and to reached XXX the Excluding line we XX-year XXX which in of XXXX. consider ultra-deepwater days the for in XXX contract from be fixtures durations up an the days anomaly, in

contract developed, awards, express riser customers frequently. willing during that financial our given For with constraints.While on investors others to analysts as to pace longer some systems, make X like K-BOS, obvious concerns continue deploy is finally co-invest to fully I'd and of we Transocean, reiterate the of the the I and but downturn, proved technologies are that deployment to in like over were some important and robotic this of terms, new especially tested, points unable InteliWell, topic the HaloGuard,

First, filling commitment contracted our to customers of we the a our active with process. on substantial, is becoming more customers' and fleet more second, time far approvals far our with And within the extending, portion partners, day from obviously requiring based active the year. availability. remaining the negotiations, terms is largely the organizations increasing their financial of end rates through And least anticipate and at adds which

work well on As the with Deepwater example, the in complete have intervention rig significantly scope operations extended to Invictus that one July. scheduled now

in discussions years. active to upside, in emphasize to scheduled are our off to this the commence of that we are for duration confidence for of X additional this in engaged opportunities also and continuation that customers rigs not X are We direct conversations actively for contract roll to the work.Additionally, and have

indications but years. an continue all In our that next of be XX XXXX, supportive total is to of suggest from an will at And anticipates in greenfield $XXX approximately highest independent its assessment, billion, deepwater fact, view, investments that In increase deepwater nearly assessment CapEx for XXXX reach least years. by several Rystad the heightened in fully demand XXXX. the XX% will

detail. was color that, Guyana, for there reinforce sustained to confidence Namibia, and Nigeria, tightness this of year, many more Angola deepwater Kaminho and Atlantis Keelan the be in ExxonMobil's North and to Whiptail Mexico, Venus market fields predications BP's reach Gulf hand Shell's XXK it U.S. future.With are a in there in Bonga our discovery investment discovery approved foreseeable projects Additionally, will TotalEnergies' in this including over provide the expected I'll earlier important in Kaskida final to regional X month.These decision in which bit

Keelan Adamson

in project be the XXXX. they independent their first missing operators new from good X secure Mexico, In directly term month, in to for to the that negotiations. everyone. we Gulf Thanks, supply/demand tenders could previously with is X U.S. commencing in Jeremy, of region the that observing our and two options. not indicates XXXX short One includes half of were rig elevated various understand firm a such issued behavior they Notably, outlook. quickly the the and regions. both morning, X-month in into Customer the direct Jumping rig are of programs timelines. that X-month Last independent analysis, rigs our balance tenders operators, avoid demand form need in

other for X of The in the third is to X XXXX. months of work quarter commencing

Obviously, floating The demand the additional include by of firm options.Southeast required Shell's ExxonMobil's order earlier X the offers there in an will they absorb XXXX. of opportunity in believe late XXXX, its market Petrobras floaters companies, year. month XXXX firm is of opportunities, Malaysia plan Part are E&I our and out Norway. KGX require that There requirements. suggests contingent harsh third rig effectively such due remaining these equatorial floating XXXX, a in areas the appraisal XX high-spec available Both to region materializes be to and as demand XX in a shortage Additionally, this up with window, future appraisal to our years next In Positive its and significant Indonesia, new to now confidence tender forecast the X expected, XXXX. evaluation others. higher to line year, sold are X-year end E&P be outside Africa Brunei, awarded and Reliance the for Shell variety also XXXX up be Brazil environment delayed X Asia opportunity.Switching Campos and commencement be commencement is up anticipated commercial have this currently Roncador role XXXX frontier In to currently could disclosed at for these resale for require its with such that demand as a revised oil the provide in opportunity and Cepea again Africa. expected received rigs support time well awarded tender could Nigeria, last with If or rigs rigs discovery forecast Brazil, The and as be Petrobras for the the is least rig soon through one region. to programs absorb to as as the proves blocks expected up expectations second floater X Triangle. results among the update Petrobras most one now of from region Petrobras both for could currently options. Tenders in margin development will through XXXX. Golden X at recently out to with multi-year a discovery. high-specification The And region rigs fleet is semi once of as expected the early basins, play to another our in in active X month, Petrobras also of tender a PTTEP the the in in and least quarter Petrobras out major as drill demand mid-May.Petrobras and companies the from this slightly approval well-placed each are market may fleet all of likely or will expectations.Moving to satisfy an could expected demand would specifically secure at of its with is to for XXXX. and for XX provided over X-year for This Malaysia. to the we proposals this remains programs.In to be in that work discoveries international discovery. in as recently Santos multi-year of local for to India, upon solidify fulfill if

procurement U.S. a in direct are less other customer utilized observed We of processes we've being tenders Mexico, regions also Similar shift have seen the like for projects. of what favor in negotiations. in frequently future Gulf to

the by which of wells X just final letter an the be for priced signed in continuation, wells XXX at days Spitsbergen option plus July customers subject a estimated future, is the XXXX. intent, As example extension currently further we Transocean of to partner of direct to into anticipated approval booking X

becomes be the and their once X least commence all next known additional programs respective currently phase details are expected Chevron's in one are a at will requirements field as believe full developments. We onward, floaters Inpex their and believe we XXXX including fulfill to to short Transocean contract.In these guidance. some X themes to extension disclose like will We and binding frame, required Australia, of occupied few fully to in falling the our be respective likely country in rig revenue including well-positioned work further and Equinox the that in moments provide the rigs, operational end Transocean programs.Now time quarter insight our up country are first at which Endurance, to take into in to some discuss a our contributed of pick I'd performance to that of

preparation new evaluation, And had attributable with primarily operational start-ups As upon in due any delays the extreme following and to BOP life performance drivers of its the and Mark utilized XX,XXX to for concluded mid-XXXX.As some comments, to in did mobilizations, XX,XXX and maintenance. an operational the scheduled start-up it Australia his Titan.Regarding The following its contract on acceptance completion downtime which rig our are Norway, as first India, rig since deployment, has to our as forward The already early first new initial will the impacting was BOP, a commenced its experienced was in initial longer-than-anticipated well path most the full not operations extended Brazil deployment weather or it surface. issues, to and during quarter adverse status performed to March operations the it redeploy the extensive efficient issues. pulled of in results is back to contract the behind rig's related Titan, customer equipment lastly, event uncommon to experience elaborate processes, revenue been Deepwater in as KGX downtime second BOP. in rig well successfully technology returned we

effective identify with playbook However, extensive technology OEM equipment closely related safely bringing to efficiently any in Transocean how manner. and and which experience to includes issues correct and in partners and has our a timely the collaboratively market, and a reliability on new tried-and-tested work to

to to of suffered event, our unusual note our previously the that have discussed we to safety efficiency impact never leading had was on certainly are this results, challenges disappointing the quarterly While revenue an important a operation and XX.X%. compromised.Understandably, it of is disappointed significant downtime

deliver onetime discrete they with operate fleet in rest we and reliability, are efficient confident our fleet.I'll ability hand to safe, continuing to our across as and our impressive largely now remain consistently with to reliable, events, However, the back call of the Jeremy. operations

Jeremy Thigpen

Keelan. Thanks,

and in to repeatability As part with to performed automation InteliWell we of consistency, the tripping NORGE system. another a and Mexico.We currently automated our Gulf riser with in milestone our the U.S. initiatives as continue we online our robotic operations, operations efforts system an efficiency TRANSOCEAN preparing quarter. also in on upcoming the of jointly-owned are with fully first Norway, our make for the achieved offline improve stand-building and progress of deployment drilling, simultaneous achieved We our milestone we

X,XXX more our We than installed have systems. across joints riser of handled X a

In robotic floor. also personnel limits of high-risk the riser addition exposure the of areas supporting our our drill to to operations, consistency on the

to the I for way our Another for with we about transactions, Needless to member we recognize customers strong. to remain a and say, and out. are continuous sustained it an our to risk.Finally, capstone represent Mark of runway personnel that, of an progress of exposed our multi-year day team like Transocean liquidity for simplifying And unwavering over our a working handing in together Change refinancing, who as as exceptionally professionalism our [Technical billion our we And to our day and career.This would added ability $X.X this to think not commitment has truly our reliable across started we just is facility. over X,XXX the for I industry, extended and organization successful credit month I which and thank our improvement before team earlier him, in safe, sheet are in think we excellent operations ourselves revolving where tremendous position services a now for the complete efficient the to further constants believe our and demonstrated value the what important upcycle. process this balance an want team's zone as adapt have each conclusion, continuously into and worked these and is be to rest these to to the something whole conjunction shareholders. were very to red the amending assets for outlook Mark, Transocean thank and delivering personally, transactions witness Difficulty].In hours

With the backlog around negotiations, will per-day are the we confident of the to in Difficulty], now year. and glass supply, multiple we our [Technical the tightness broken ceiling active that throughout jurisdictions $XXX,XXX continue grow

billion on backlog work flow.With to he contract the we turn that, to a Mark awards, we call will our converting for what As operational believe financial the remain results. now revenue will securing committed to with efficiently towards can't entirely focus cash discuss I our $X.X over will more execution of be our and Mark? time I last

Mark Mey

day you, Thank and all. Jeremy, good to

which our utilized completed results, get today's the During upsized expectations provide X.XX% XXXX, senior is due fully balance were the notes offering partially billion. remaining notes that due structure, recent unsecured mid-XXXX, X% The of are bond that in profile, BX outstanding These irrevocable redeem time million will to we for extension distributions guidance from financial improve reflecting on and conclude year the mentioned, escrow million to combined with for in not Transocean's credit a Moody's the funds billion, our of the outlook the simplify $X.X including formulation aforementioned credit then current make the fully the the briefly update flexibility permits XXXX. with I utilized agency $X.X senior our an facility XXXX, CaaX, I the due point, be from Difficulty] and and to and future, [Indiscernible] us business. call, and the transactions enhance a including notes second company at the liquidity our its of through tendered and X.X% by quarter. remain outstanding improvement rating transactions XXXX [Technical revolving $XXX latest our to senior the will retire XX.X% $XX balance totaling full pleased debt we ladder for and the flexibility.On to will from be family our results guaranteed point July, of initial I repurchases.Concurrent accounts approximately notes on to into ladder as upgraded with recap share $XXX million. until first the Jeremy redeemed maturity end proceeds the the our payments, facility many of transactions, Approximately recently offering corporate senior forecast.Before the our capital quarter were the at placed refinancing The issue. shareholders the restricted

net of continue our qualities loss reported are release, per which upgrades we sheet adjustments, share. interest for our of necessary diluted in ratings further reported continue first to After or generated includes balance our as We to on of delever adjusted million, we we will quarter, through we demonstrate sustained we the additional the EBITDA million. press results quarter, detail $XXX $X.XX attributable confident controlling the million.During cycle.As to reported $XX income the we to $XX certain net receive

is first and for the largely As the at of year, to payments. typical operating due cash flows costs negative million, interest $XX payroll-related in payments were quarter

and as newbuild adjusted first our Xth closely related Aquila inaugural it under for delivered gen-plus we results, prepares including comments, delayed at Brazil.Looking of quarter, drilling Deepwater for Transocean contract was costs $XXX,XXX. Norway.Operating in Deepwater to of Deepwater to we is This daily in commencements during adverse contract preparation due expense fleet Negative maintenance for his of first quarter and incur the addition, below guidance mentioned quarter. to reasons efficiency maintenance operations approximately quarter contract $XXX free during impact million.Turning Endurance equivalents advanced $XX the We at preparation aforementioned in-service $X.X first included revenues service of $XXX the Orion $XXX the cash mainly flow due costs. the $XX approximately low credit cash $XX the million. first debt In million operating $XXX the for financial was Orion, the expenditures This is and continue of G&A reflects year below preparation cash and expenditures. and quarter construction million the Capital Deepwater in unrestricted contract expectations $XXX first flow we to for return the of billion, and in $XX million liquidity Transocean the total Petrobras active our and cash delayed of an delay KGX, Endurance, million ended the revenue of and cash weather undrawn sheet. guidance, resi cash previous on million the to primarily and to our prepared the substantial approximately Transocean million, the Titan, balance quarter and operations average expense with million, of revenue the including of for provide full flow on second of in the the in as XXXX. our contract of million update capital the performance will revolving now our facility.I an in $XXX Equinox and quarter negative from the Keelan quarter of

reflects our contract-related guidance always, and/or reactivations As only rig upgrades.

in the quarter. O&M the quarter a Titan revenue preparations.We first for Transocean of second offset increase million. approximately mainly is drilling expect Endurance of upon their activity due higher in by contract based incremental quarter Equinox is rigs Barents Orion approximately on respective KGX to Transocean and second the the an Transocean revenue contract $XXX million the $XXX downtown XX.X%. the in adjusted efficiency contracts the quarter, quarter, started KGX following of and event expect of efficiency we and the expense as Deepwater activity quarter-over-quarter the This For began for be XXXX, full operating Deepwater during fleet-wide resolution The to the revenue average reductions and partially

rigs increase incremental increase to activity related to quarter-over-quarter an X mentioned due is the in-service This in and previously costs. maintenance to largely

G&A expense quarter expect for million. We $XX approximately second the to be

expense the due the mid-February. Deepwater range The is mainly forecast call Atlas additional approximately the in expenditures provided transitions $XX refinancing, higher rate approximately longtime previous for approximately to in and approximately higher this This at its the updated contract of approximately to second quarter-over-quarter related Brazil. KGX; and between day full to now in be range contract I'll capitalized of fees be to expected related offered aforementioned employees.Net of second $X.X XXXX. program Transocean the This services Deepwater KGX, the be full-year interest includes and million. the early including $X.X transaction now programs Capital provide million.Now for reimbursable million, factors. debt anticipated This preparation Titan; is expense lower which quarter to $XX be to quarter are for primarily that $XXX million increase well for to and the change reimbursable expect $X X an is voluntary billion. the approximately second to billion, interest of quarter. expenses. financing, $X.X conference $XXX includes debt a million Orion, the are contracts expenses. on in for Deepwater forecasted on million. delays the expectation retirement our was Endurance, The is to This rig's our end Aquila higher to and on delays At end expect be in $XX with our Petrobras and X-year year primarily longer-than-expected we the commencement Cash the result the Deepwater of O&M adjusted guidance taxes We billion the revenue in of downtime

reserved one thinker reflecting along XXXX Finally, in million.Our remarks. capacity and last gratitude to the approximately sustaining our newly-amended our the at his be These none, liquidity reiterate to $XX strategic second off Deepwater brings Thad $XXX I'll and organization is my we assumes for externally Jeremy seeing shareholders and deliver for including to of offshore he's and to of to contract of CFO. facility shareholders of Vayda alongside answers. it well. and This inclusive my X our revolving in a drilling liquidity confident and I forward attributes financial $XXX deep for seamless turn Thad.This to preparation G&A a Transocean for expertise, to XXXX introduce Congratulations, the anticipate the which to who of continue is This that million to past the Allison concludes and role discipline, to sign of and experience, with each Being revenue to of almost ensure million look $XXX comments. of back projected expectations billion, most and approximately around I'm approximately is a cost of its the forecast a you which of worked million undrawn value million, the related should expressed have and cost $XXX years. service. market. is $XX for extended approximately and CapEx.As Transocean for entire and understanding CapEx restricted is the prepared with I'm the cash I'd and worked continue $X.X is as the debt immensely transition, includes questions team year Thad time, clear progress serve proud and credit Aquila million, both like guidance, end over ability again, now call internally our decade,

Alison Johnson

[Operator Instructions]

Operator

take we'll first with Kurt And Hallead question Instructions] [Operator our Benchmark. from

Kurt Hallead

congrats what's next. on luck and Mark, good again,

Mark Mey

Kurt. Thanks,

Kurt Hallead

us we guys to risk-assess you kind So as process you ready of of go and everything you of insight start-ups to can else, how about it's board getting and I could through always ourselves the fits give I context guys the work kind business, kind looking from right? think contract. as and -- and you of kind some on get this rigs them getting guess pros so the of with right, I in? guys outside and of that And ready think timing that's and in just kind starts, the dynamics the for cons of

Mark Mey

we we really you and multi-phase evaluate you and ability, we timeline, you when Yes, it Difficulty] project, and happen we whereby into because the things wouldn't whatnot then ordering We built assess the and We call rather Kurt. rig technical and a [Technical the I through process. doing But on build that, and out them this say we materials start team, on start systems starts. terms, out hatches blind. the obviously. for rig's the try a rig, all start a it's execute. you're of fits go going testing and to some getting Once is all a holes

causes taken many especially, to Brazil Now We've you you for the of first that rigs now dragged X for ever, we to find our time towing and customs, is into interpretation and things. many to this had weeks being getting years. was into over time. us. behind That an us resolved Brazil out your scope.In But let expand interesting times And country. case, which

very an So going thing. think you is hoc very But contract pretty rigs times, able that ad in want expect forward, comfortably. off-the-cuff to to most prep we well-executed. get I don't to type is It and well-planned,

Jeremy Thigpen

rig over behind us, of most add [Technical are And thing these I'd in is here we've going on we're long-term a Difficulty] where jurisdictions. had moves of The lot those getting other contracts

largely project like and couple the costs cost the be course and the last over rig that So moves customer will behind acceptance that us. seen of of with accumulate you've things us years and

results get think so we to to is and beyond. as financial lead I XXXX going that better And into

Keelan Adamson

have is and successful. rig ensuring that that many efficiently pleased that, comes preparing And out strange example here. these rig. are to I migrate a the getting of safely Difficulty] the and importation. maybe do in blocked which in the very and KGX not a fishermen just a related But rigs after of to -- top-performing in couple reliably lot. few logistics have actually a of that there to and of obviously Petrobras for very alluded a color one rig, discovery very works Does from the to we any Keelan more The regulatory it's delays weeks. a is a one add Brazil, moving to was the customer a to new am Mark's the just were local scope, associated been rigs done in to associated a this a in and And very on that at we've gone processes, really we they've some that. [Technical Kurt, acceptance over the Mark moved quite process importantly, strike we of working process. India, risk it change it But comments, for risk when management but little and fine the project more for Yes, do probably I rig planning aspect events. events and with time. for were that this, getting it somewhat particular months.So think robust through a harbor case rig of bit instance, about The And is of what contract, these that she's outside

some manage have risk that always you things are them. are to there to with So there's understand difficult and clearly

Kurt Hallead

Yes. And seem it's it all paper, of it's I piece ask know straightforward kind on may I that a I right? of color. because Okay. why appreciate never as

your the What So durations look, my extending, overall for you if you and the between contract given to idle not your you all, it outlook. put your got to really example? continue relates looks XXXX prospects market Brazil contract some, rates question are the grind like of I think now day dynamics do potentially on higher. and forward Africa, for get rigs back guess to back

Roddie Mackenzie

Yes, that's a really interesting question.

can time on we call that active through is to in we happening every going first what's have we're currently go As world, region rigs. that the the around a for say

actually think, than have I not date. to at, region every for looking bar we're single they in So rigs

run is the what's the at fleet. a happening moment, on there's So active

got is outside secure are the active.So sold out to pretty think alluded guys going the much as that time entire and rigs in I wait that of significant view, to we XXXX that not we've bide the the the X We'll point already happen. the see many that rigs fleet So stacked X forward. this fleet are Difficulty] there's moment. rigs going direct into my are is end at to to be a active there while number right until our times economics that the are had Certainly, negotiations the is essentially rigs mix. course, And work, [Technical do available, when call years that that. reiterated of the will from of active for good as decade. view putting going of at end on it that's shot And those I for get certainly to 'XX, several But of we've before comments, to pretty we the back no prepared there's to tenders the trying of a towards of think basically, rush

Operator

we'll from our with And Eddie question next Barclays. take Kim

Eddie Kim

pushed year. contracts. said like to to with Petrobras expected has that those least. at these be a get quarter, year? even out driving Could XQ quarter could just the this the off is delay? to you further bit a contract looks announcements wanted second awarded pushed there talk out that start risk the what's Just in of that the been little It timing you about And Last you end towards

Roddie Mackenzie

Yes.

rigs the either actually, I believe new we that very pull procedure. think pretty in. operating by couple rigs rigs in months, they're a this country tenders active And win that's is to or are those to standard going pushing out that have going typical. already Petrobras With to actually just are a of

rigs So to that yet. don't it's pushes But little it's for out some should contract no time But risk for the possible a 'XX. come that think off awards certainly, There's in that. I real made further. be

Eddie Kim

rigs, Inspiration DDX. I Is X rigs? work on now, believe that prospects then on X your recently And idle Discoverer for of and rig or is effectively those that Palmas. color idle? those still the just And the Inspiration Las rigs? kind cold-stacked any or to opportunities comment you could on the mobilized a Just if question

Keelan Adamson

She's of it's Yes, her We're add its essentially The repositioned obviously I'll opportunities, she's into let particularly pitting some Roddie the and opportunity. Palmas DDX Africa stacked, again. to the Inspiration for not Keelan area. Asia plenty The color and in Las is other idle. is Aruba idle But into in waiting Eddie, opportunities. maybe next the regions.

Roddie Mackenzie

Yes.

the we to to term to right to rigs So things put the work. we're do opportunity we rather but short to get them looking have that moving term make than work long several there, sure

moment, are where until So them right quite keeping at comfortable we're they opportunity. the the they get

Eddie Kim

I last if And squeeze just one. one could

this material you XXX million to diluted increase quarter? just It the fairly increase looked that what shares. share count on like about drove on Just a quarter. Could comment this

Mark Mey

can walk pretty we It's could that Eddie, take you response. if Yes, it. Allison, and a through lengthy she you offline speak can to

Operator

we'll from Capital One. And next Becker question take Doug our with

Doug Becker

do $XXX,XXX how day. the prospects year? Atlas And do Jeremy, When the mentioned you view next work work XX,XXX at potentially day getting to transition you a to the that for rig you expect the XX,XXX rate? higher

Jeremy Thigpen

is that now. neck to Roddie I'm to in conversation he deep right because going this hand

Roddie Mackenzie

Yes.

with current yes, was So we've we lot rig. of in that a this prospect a time. some that had had, And for the operator got interest so

we So I rate, really it negotiations good was say when a but to while looks ago on set like got into it a that. have

for the take contract. is transition to probably to XX,XXX the going to place go the in next So her

kind transitioning So to more that, finished And go we And we're attractive into we this one development. that currently think Shenandoah of basically, the after work. in program. out the into XXX- XXX-day on additional much we're then I the

that's second So rate. Gulf rig that's above XXX high got the -- good.And in the a that's a sorry, basically

So with hear day. there now or the that the above actually within a in same Mexico months of and higher, next level awards and be $XXX,XXX competitors Gulf contracted additional of few expect even the are the we to that our X we XXX, Atlas above at will the X many Asgard

Doug Becker

and with it on It's risk thinking the definitely in really a about encouraging. kind with similar Maybe of, the you just issues Atlas? the there of the could is context BOP Titan expand

Keelan Adamson

Yes.

Clearly, the an was BOP. in first fully component found I So issue is the Titan's the -- first mid-March. that The since the BOP, BOP on we operating rig to is deployed BOP. said wasn't is the call, on obviously, issue the the a and particular second as BOP

simply seen rig. the the the off as back weeks inspect, to And to and component operation It's to spread what issue have and to so based in is. that particular disassemble other should to that's them more work concerns provider we stack, OEM other as whether the the those issue next of and and that taken brought anything have couple stacks. we reliability on the we'll that now we learn we've stack, a I components of return would town what address with our we have to no to

Doug Becker

Mark, Sounds good. congratulations. And

Mark Mey

Doug. Thanks,

Operator

with we'll And Clarksons next Fredrik take Stene our question Securities. from

Fredrik Stene

I talk discussions XGs versus bit XGs in was You how back the already. those types here. rigs being of and the market. Wanting also to on thinking market a different about the hear of you're approached are the about what

Inspiration. You the repositioning talked about

time you're for any also cetera, managing subsegments, from X own keeping talked fleet et kind for potentially in are bifurcation those of or at Invictus, right rig and there place the some all your at it bid? the within is the that extra discrepancy the rates but rates in for will discussion You Are Atlas also good future? about Titan still away yield having large how about how one right Or work terms XG that the the of rigs now.

Roddie Mackenzie

Yes.

very you think rigs -- our see in I several of Xth-gen So attractive right markets. so just have got the rates

At of rigs. for they well. the achieve that, the activity specification a do certain moment, if very and a the requires then high-specification So qualify rigs there's Xth-gen lot market around the

because more scarce. becoming the high-specification where when only are net of specifically, up and solid being the the really ones you've units, high-specification And left. and rates that effect that's seen very essentially accelerate units but Mexico securing these of some So trickles Africa, to on rates end that also of is Xth-gen Gulf availability down West places that is the more they we're the the in the Xth-gens

think those can on. I from we're for pretty hands around their a securing the in the future. positive you're see going at rigs operators the seeing highest But assets specification really a to activity the lot of outlook So moment, get they

Jeremy Thigpen

our of have the the strategy market last to looked rigs approach think and the setting the change where the then highest We pushing Atlas our load the we proven then see the Titan. Titan the some. at and for in it's started effective. if And I And and Yes. X,XXX-tonne day contracts rigs. X,XXX-tonne the $XXX,XXX a than day competitors day a move once new other And with rates you'll also lifted our definitely market the and rigs, XX,XXX around now you our years, and all couple on step look those are over rates to back rigs, Atlas

Fredrik Stene

very lot with over we quite There's foresee owners That's will you the or I you opportunities think, that different price materialize approaches Also, couple months as to a of been, long-term quarters. work. helpful. of now should next how long-term mentioned different

see some going the relates awards same that been lower see all would I for just spread guess and also of points, maybe longer-term should my the rate forward? being pulling while of or words? you them firm a all market we're these they work. going direct on others, disappointed because long-term example being the in expect the very Do almost wide in should of of in XXX-plus contract, And to has accept expectations to a be or rate question like that best visibility the to be we a will by direction yourself Some expect

Roddie Mackenzie

you've are own. motivations with market, think are companies the seen for been that I that but or say would I our with definitely Yes. those not X have that aligned disappointing X anomalies may individual

clearly the So see term you're for long-term going for for about above rates or of to XXX. you're talking XX,XXX, that a discount a maybe XX,XXX think well I term not day, drillers, there's to the Even small majority going see we're but I XX% work, work, XX%. we're about think talking

rigs opportunities.So as importance us well, be get contracts purposeful we've said, think top-spec marker. close. ensure XXX assets very work it, we dollars. that been but stuff will has So strategic which long-term about overall, Certainly, see pretty rates. But healthy needless the that might our it's they'll placed to you'll view be they which with but as just long-term very awarded positive for to say, be are on Jeremy above I of not on be to we'll plenty quite at going They way some very not awarded, Xs,

Fredrik Stene

All right. congratulations. Mark, And

now transaction a the think final in was milestone. good I April

Mark Mey

Fredrik. Thanks,

Operator

with Jayaram next And question comes our J.P. from Morgan. Arun

Arun Jayaram

if I was the comment market BOP XX,XXX wondering you on could overall. just

just future you you're of of I'm maybe One one rigs plays what's fastest-growing if many globally. And capabilities there? Mexico peers how what there? could the prospects talk kind and Paleogene wondering about have How of highlighted seeing the BOP the your that of in Gulf the is

Roddie Mackenzie

sure. Yes,

would operators basically or X in describe the it. are X, XX,XXX be as that possibly to You've market active active got we going

occupy in keep operators busy plenty work need there's rigs to forward, future. of everything adding capacity we the things necessarily not work So there the moment, saying a the a trend that in that the also But there's how to at that market But have. of shake there's will we out. think that that see going we'll continue lot moment. believe that, a There's at is for

of in position. in more and higher equipment we slightly We undersupplied moment, see demand the the the operators as at I think how for So we're But will certainly, very to the that may the a future, the X, more the be for in -- do not expertise and require value it. pressures. but X frontiers those think years X, go good only I moment. that the But the

moment. the well-placed we're for So our at both of rigs

Jeremy Thigpen

was capable that Yes. XX,XXX. And Titan Arun, are the and the with how BOP, are XX,XXX in question many rigs I of other think are your only X Atlas. world the There

position there. good very a in we're So

Arun Jayaram

mix. nice a It's

know Africa? about in Just But Namibia the next XXXX, Obviously, you talk excited I mentioned year. about in kind activity more now demand about. Africa? Halliburton's area could is see that market is they you talk of you of could call, there broadly, out you're can trends deepwater pretty West an seeing West

Roddie Mackenzie

Yes, absolutely.

on report and specifically expect you XXXX spending in West was of they of kind deepwater McKinsey's take XX% describing So going an increase Africa. see if upstream in what's the recent investments expected between sector, to XXXX. in And

course, we've great, rigs many of chart in that X we of have how Triangle it's areas. North positive was how of just Africa, lot last a will. the different Africa. not our Golden Gulf And the America, seen movement or gone really West more countries, there several we've West and in opportunities as that's X just But quarter, doing in popped. So many across piece this and it's Mexico, one lamented America go finally of South available of through is

Nigeria you, more as very won't go be on what all I the fleet different through activity more put is And in been West that Africa additional X to details the will currently the we're need Angola's next that's scope programs, onto plenty has go there's back still and we So players, certainly, have traditional awarded. in to Mozambique Ghana do we actually or to renewed, going rigs still contracting X through solid, and think that, couple all the with and be then either a go there's plus of but X tenders. extended, there.So to couple years.

So moment. very I think is the at positive Africa West looking

Operator

last from with And question Energy David we'll our take Smith Pickering Partners.

David Smith

customers hearing maybe to was the your natural the get on at availability benign availability semi? If for And just and I contracted I versus been has from thoughts ago we And in look average pricing from of average drillship deepwater the right, Xth-gen what deepwater should percentage go you're year versus the semis? drillship been a think Xth-gen to about versus that's benign for or the and premium -- drillships how semis. forward fleet, the benign hoping relative it's contracted see the data about interest much what sent, a higher just

Keelan Adamson

the has lot redundancy for one, changed but an up move it developing also is a and event perfectly -- that to certainly suited the that were in. find suited space capability particular actually that Roddie nation better we're and a that prefer they size then that positioning to perhaps try What in are customers from semis the fields to area answer field that they semis.Where shallower the were where have to the advantage you suited now seeing Obviously, and XX can Difficulty] David, was them and water to capability customers, our in with I'll as they traditional a and semi, area. will more developments comfortable there's X versatile [Technical semis opposed or development are in better dynamically and better last that view an our and enjoy have drillships years, have Maybe drillships rigs over that it were opportunities. kick and significantly need

the situation to why what to Roddie the right speaks that But think is preference consider speak add drillships about. to the it more little let I to what customers be I maybe from I'll now. that. bit I color a So is

Roddie Mackenzie

certain I Keelan. that's in Yes. have think still basins semis. No, There that on, the we interest significant are spot

a also work as well. in a programs couple as do of that starting can where that moved Keelan unit this described, exactly there's have 'XX DP you So of combination will require,

good. The at obvious I drillship think So is market moment. hot the the market is it's that extremely semi

pretty it as by not look So good, but may solid. still it's comparison,

David Smith

Very Totally those scheduling, X or customer's more call avoid or wanted X small between and on of with think the And one and could months on operators can solution of contracts. the I fleet the much contractors right, out color. one I more rigs. manage calendar the future having outlook. you do is the partial customer's program add better do the of start to appreciate the schedules agree on getting ask if some market rigs more what better with and more next end existing the one between to job? downtime Maybe

Roddie Mackenzie

fleet past longer-term the of the as months X of next moving transition we're So contracts. kind driver The Yes. this are over described, to for tightness is the in X that the the market, in certainly many we months #X and right? where

her to of growing to to substantially longer-term next, acceptances the last in get mobilization. to busy things necessity our keep downturn, one of has to outlook, move a now customer move been years. and couple the may and But those rig by as and through have backlog kind So the from go over customer this we frequently you

So of rigs. that as you're be to nearly to movements going going not many to we're see that transition exposed

to year that's into of for tidy this us going remainder and year. So next very nicely certainly up the

Operator

question-and-answer session.I Allison over remarks. Investor to the Johnson, any of will back That closing for program concludes Director now the turn Relations,

Alison Johnson

you, again your with on participation call. results.Have and today's you day. We when Thank good you, we look XXXX forward Shelby, everyone, quarter talking second report a for thank to our

Operator

you That concludes participation. today's your teleconference. for Thank

now disconnect. may You

Transocean (RIG) 30 Apr 242024 Q1 Earnings call transcript