Wednesday, December 22, 2010


SembMarine: +1.4% at $4.99 yday. May gain and test 52-wk high of $5.20 on a US$400m boost to orderbook, after being engaged by repeat customer US-based Noble Corp to build 2 jack up rigs. The deal comes with options to build another 4 rigs, which could bring the entire contract value for the 6 rigs to around US$1.2b, equivalent to half of the US$3.16b contract value secured ytd. The options must be exercised by 1 Jan 2012, and come with potential price escalation terms…

The initial 2 rigs to be delivered in 4Q12 and 2Q13 r’ptively. The contracts affirm the recent sector-wide pick up in orders for high-spec rigs as oil cos replace their older fleet and upgrade some to meet higher safety standards. The news could also help ease concerns that SMM may have priced itself out of the race for some of Petrobras' 28 rigs.

DBSV yday raised its TP to $6.08 from $5.48.

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