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Rowan Receives Two-Well Contract from Turkish Petroleum

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An N-Class ultra-harsh environment jack-up rig of Rowan Companies plc , Rowan Norway, has been awarded a two-well contract by Turkish Petroleum.

The rig will operate in the Mediterranean Sea for an estimated duration of 100-140 days. The contract is expected to begin in late 2018. Currently, the Rowan Norway is warm-stacked in the United Kingdom sector of the North Sea.   

With improving oil prices, rig contracting activities have increased. Recently, there has been a huge inflow of rig contracts. Companies such as Noble Corp (NE - Free Report) , Transocean Ltd (RIG - Free Report) and Seadrill Ltd. (SDRL) have gained from the trend.

Rowan Companies primarily provides services related to contract drilling to the oil and gas industries. The areas where the rigs primarily operate spread across the Middle East, Trinidad, North Sea’s Norwegian region, the Gulf of Mexico and the United Kingdom. The company’s premium fleet comprises 23 jackups and four ultra-deepwater units.

Rowan’s new offshore drilling entity — ARO Drilling — has recently commenced activities. Rowan and Saudi Aramco each have 50% ownership in ARO. The new firm will be able to participate in the growing offshore drilling market of Saudi Arabia.

The company offers investors stable earnings and cash flow visibility, considering technologically advanced and versatile offshore drilling fleet, strong backlog as well as considerable pricing power.

Price Performance

In the past year, Rowan’s shares have rallied 57.5% compared with the industry’s 11.1% increase.



 

Zacks Rank & Stocks to Consider

Rowan currently carries a Zacks Rank #3 (Hold).

A better-ranked player in the same sector is Petroleo Brasileiro S.A. (PBR - Free Report) or Petrobras SA,  flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.

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