The Most Important Offshore Update of the Year
The Calm Before a Very Big Storm
I genuinely like businesses I can understand. And when I say “understand,” I mean something very specific: I want a pretty good idea of where that business will be ten years from now. With many companies, I just can’t get that level of conviction. But with a few, I can — and a few are all I need.
I know enough to know that I don’t know enough to make smart decisions about a huge number of companies. My circle of competence covers certain types of businesses, and there are many others I simply can’t evaluate. Honestly, I think most people can’t evaluate them either. These are the businesses where the future is very likely to look nothing like the present. Maybe a handful of people have deep insight there — I’m not one of them. Knowing where my competence ends is incredibly valuable, because if you don’t know the edge, it isn’t really a competence.
And I think I can genuinely understand coal businesses and I think I can genuinely understand offshore drillers too.
A major offshore-related decision is approaching, and it could have a significant impact on the entire sector, especially for Valaris and Transocean. I want to briefly outline what’s happening and why this moment may matter for the deepwater market going forward. This is shaping up to be one of the most important offshore events of 2025, because the outcome has the potential to influence long-term project economics, future rig demand, and the overall direction of the next deepwater cycle.
Offshore is a highly cyclical sector. In this post, it’s crucial to understand which phase of the cycle we’re in and what the offshore landscape may be ten years from now. We’ll look at:
Supply: What the World Actually Has
Demand: Key Deepwater Projects 2025–2032
Challenges of Reactivating Rigs
Historical Look at the Last Bull Cycle
Impact on Transocean and Valaris
And What I’m Doing About It
What comes next isn’t priced in — not even close. I can’t fit everything into a single post, but I’ve simplified the key points as much as possible. And the breaking news is this:
