Brazil’s state-controlled oil giant Petroleo Brasileiro S.A. (NYSE: PBR), or Petrobras, announced today that it was cancelling an order for five new drill ships that had been placed with Ocean Rig UDW Inc. (NASDAQ: ORIG). The five rigs were planned to be put to work in the presalt layer of the Santos Basin, at water depths up to 3,000 meters (just shy of 10,000 feet).
In its press release, Petrobras said:
This decision is based on the reduction of future needs for drilling, due to a fewer number of wells expected to be drilled in the pre-salt Santos Basin, relating to a higher productivity gained through the project wells in that area.
Given the company’s lack of production growth, however, that may not be the entire story. Petrobras could be looking for ways to maintain profitability in the face of its long-term $236 billion spending plans.
The five rigs were ordered in February at a daily rate of $548,000 for a 15-year term. At the time, Petrobras ordered a total of 26 new rigs, all to be built in Brazil.
Shares of Petrobras are down 1.4% in early trading this morning, at $18.23 in a 52-week range of $17.27 to $32.60. Ocean Rig shares are down 1% at $15.68, in a 52-week range of $11.70 to $18.43.
Paul Ausick
Are You Still Paying With a Debit Card?
The average American spends $17,274 on debit cards a year, and it’s a HUGE mistake. First, debit cards don’t have the same fraud protections as credit cards. Once your money is gone, it’s gone. But more importantly you can actually get something back from this spending every time you swipe.
Issuers are handing out wild bonuses right now. With some you can earn up to 5% back on every purchase. That’s like getting a 5% discount on everything you buy!
Our top pick is kind of hard to imagine. Not only does it pay up to 5% back, it also includes a $200 cash back reward in the first six months, a 0% intro APR, and…. $0 annual fee. It’s quite literally free money for any one that uses a card regularly. Click here to learn more!
Flywheel Publishing has partnered with CardRatings to provide coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.