SDRL
Posted: Sat Sep 13, 2014 5:48 pm
Is the dividend for SDRL under threat and likely to be cut?
Seadrill says offshore drilling market ‘bad’ this year, worse in 2015. Seadrill expects the rig market to remain soft for the next couple of years, CFO Rune Magnus Lundetrae said. He added that the current market softness is going to be a challenge for a couple of years and that the market is going to be bad this year, worse next year but then it will stabilize. According to the article, rig rates have fallen sharply over the past 18 months as oil companies cut capital spending, just as dozens of brand new offshore rigs hit the seas, creating overcapacity.
I'm sure the company will do all it can to maintain the dividend, BUT if the offshore market remains this soft for an extended period it could be at risk. - Dan