Question-and-Answer Session
Operator
Thank you so much. (Operator Instructions). And we will go to our first question from Pierre Conner.
Pierre Conner - Capital One Southcoast, Inc.
Dan, my first one is macro, you started out with commentary over the supply demand and balance getting worse. Noted several potential opportunities coming. I wanted to get a little more perspective from you on, that's just kind of making it less of a problem than it was 90 days ago, is that the point or do you feel we can absorb how many of the new bills coming on?
Daniel Rabun
Its on the jackups?
Pierre Conner - Capital One Southcoast, Inc.
Yes sir.
Daniel Rabun
Pierre, the activity levels and dialogue with customers has picked up appreciably, it is hard to get a hand alone the magnitude of all these opportunities because they are fairly recent in being developed and how that will affect the supply of jackups. I tend to believe what we'll see as fairly slow ramp-up in activity and I think utilizational increase nickel will be under pressure for a little bit because of the supply.
So it's a little early to see how it's all going unfold. We've got a lot of moving parts with rigs being coal stalked, new rigs coming on board. So I would say its net positive but the effect of the new builds still a question mark in my mind.
Pierre Conner - Capital One Southcoast, Inc.
Okay, I understand. On, speaking of new builds, we ask it all the time but with the backlog coming out, the potential for some of those becoming available. In your discussions, do you see that they had asked for any potential purchases widening.
There was a recent acquisition that was a bit high from my perspective but wondered if you thought there was opportunity for some of those to be sold?
Daniel Rabun
Pierre, strangely enough it's fairly quite on that front so I wouldn't fear getting any closer to this there just haven't been a lot of dialogue over the last -- since the last earnings call on that front.
Pierre Conner - Capital One Southcoast, Inc.
Okay.
Jay Swent
Pierre, just to add to that I think what we've seen over the last several months is the number of those the operators, the owners of those rigs were solving their financial situations for the short-term in terms of getting extensions or waivers on their financing commitments. And so I think most people are sitting tight trying to kind of wade out the market and see if things improve and I think they are hopeful that they will able to get higher prices for those rigs in the next year or two.
- To read the full transcript on Seeking Alpha, click here »
