There are some risks here for investors to consider: The contractdrilling business is competitive, and oil and gas prices are, of course, very volatile.
We believe that if the company continues the trend of strengthening its deepwater and ultra-deepwater assets, its average daily revenues per rig and the gross margins of its contractdrilling business will be positively impacted going forward.
Scarabeo 9 is a semi-submersible drilling vessel recently built by Yantai Raffles, which will be on contract by Repsol YPF for deepwater exploratory drilling off Cuba.
San Antonio-based Pioneer Drilling (amex: PDC - news - people ) is a contract driller, but does its business on land in Oklahoma and throughout Texas and the Rocky Mountains.