Noble Corporation (NYSE:NE) Q4 2022 Earnings Call Transcript

Robert Eifler: It’s a multivariable equation, as you alluded to. And so, let’s say, somewhere in the order of half, something like that. But a big piece of that is €“ and that’s not a rule. But you asked the question, a big piece of it also is when would the timing occur. As Richard mentioned in his script, we’re very much on an upward trajectory on free cash flow here, and not looking to fall off of that track. We’ll see what the world brings us this year. But as I’ve kind of, I think, hit pretty hard, I think things are set up quite well in the industry for the next few years. So as we move forward in time, I think that number is more likely to go down €“ is more likely to go down than up.

Kurt Hallead: And then just to kind of put a bow on the CapEx, over the 2023 to 2027 period, where you said an average of $275 million of CapEx, then I would assume that you did include the Meltem into that calculation. Is that fair?

Richard Barker: No, actually, it’s not. So, I think the way to think about it, obviously, there’s guidance we’ve got out there for 2023. We’ve talked about just given the number of SPSs next year, we expect that number to be higher. And I think thereafter, as you think about the 2026 through 2027 timeframe, you can therefore infer that, if you will, capital on an average basis is going to be plus or minus $200 million in that timeframe. So, it doesn’t include the Meltem.

Operator: Our next question comes from Fredrik Stene from Clarkson Securities.

Fredrik Stene: I’m if you already said it, again a bit trouble with the line, but wanted to touch briefly on the guidance you gave. And thank you for the color on the reimbursables and amortization. If you subtract those two hundreds, I think we come to the midpoint of $2.250 billion approximately, just from regular revenue. And if you looked at your backlog chart a bit earlier, I think you had $1.65 billion, $1.66 billion secured for 2023 already. So my question relates to this gap here? How should we think about that? Where will those $600 million come from? You think mostly floaters, mostly jackups, et cetera. I guess you have some insights where you find it likely that you’ll be able to secure contracts that will actually contribute to close that gap. So, any color you can give on that would be super helpful.

Robert Eifler: Let me just say a couple words, and then I’m going to hand it to Blake who’s leading our global efforts there. I mentioned in my script, we have an excellent opportunity set behind effectively all of the rigs where we have whitespace. Those are works in process, some are very well developed. And we have to have some good news soon. And then others are still closer to the bidding stage. That includes some of the big enduring whitespaces, but also perhaps a couple of filler jobs here where you see some gaps. So we’re kind of working all of it right now. But maybe, Blake, just say some rig class color.

Blake Denton: The first comment I’d make, you asked about floaters versus jackups, I think it comes from the floater side more than the jackups, the additional backlog and EBITDA contribution. And then I think we’ve talked about the SPS already sufficiently to describe how that affects the whitespace, but also the short term nature of some of the contracts that have hit in the UDW create this, I guess I’ll call it, inefficiency in the market. So then we have just the timing of different projects or programs with mobilization and then, of course, you’ve got regional and contract specific requirements. So, depending on where we pick up the work and the timing, that’ll define the whitespace. But what moves the needle is, of course, converting that whitespace to operating day.