Offshore rig contractor Noble Corporation’s NE CEO, Robert Eifler, recently shed light on the future of deepwater drilling, predicting that dayrates for rigs could rise to $600,000 per day by 2026. This optimistic outlook hinges on expected growth in global deepwater spending, which Noble forecasts will average $79 billion annually in 2026 and 2027. This would mark a 20% increase from 2023-2025, reflecting oil producers’ renewed focus on deepwater exploration.

As dayrates largely dictate the amount of revenues that a company in the industry can expect to receive under any newly signed contracts, such trends are important to watch. We believe the expected positive movements on the dayrate front will aid major deepwater operators like TechnipFMC FTI and SLB SLB.

Strategic Contracts and Current Market Balance

Currently, Noble is securing contracts in the range of $500,000 per day for one- to three-year terms, which underscores the steady demand in the sector. Eifler notes that the offshore drilling market is balanced, where companies can still acquire rigs without significant scarcity. However, he believes that continued market improvements could lead to tighter supply in a few years, further driving up dayrates.

Deepwater-Focused Companies in the Limeligh

For investors eyeing deepwater-focused stocks, Noble's projections point to significant potential gains. Rising dayrates and increased spending suggest stronger earnings for companies in the space, particularly as the market tightens in the coming years. With expertise in deepwater operations and an already competitive contract environment, these operators are well-positioned to capitalize on the anticipated market expansion. For long-term investors, this signals a promising opportunity to tap into the next phase of deepwater growth.

Which Stocks Will Benefit?

Firms with strong expertise in deepwater and ultra-deepwater projects, such as TechnipFMC and SLB, are well-positioned to gain from the projected capital influx. Their involvement in key projects across Brazil, Norway and Guyana places them at the forefront of this growth trajectory. 

TechnipFMC: It excels in optimizing subsea fields from concept to delivery, driven by top-tier products, systems and expertise. Its Subsea 2.0 platform reduces costs and lead times through modular, standardized designs that simplify installation and enhance field performance. With cutting-edge technologies and efficient ROVs, TechnipFMC continues to improve subsea operations, helping operators save time and money. This Zacks Rank #2 (Buy) company is a major supplier to ExxonMobil’s deepwater projects in Guyana and Petrobras PBR in Brazil.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

SLB: Along with Aker Solutions and Subsea 7 SUBCY, SLB has formed OneSubsea, a joint venture focused on transforming subsea production economics and reducing emissions. With SLB holding a 70% stake, OneSubsea leverages deep reservoir expertise, extensive system design knowledge, and a proven subsea technology portfolio. The venture offers world-class manufacturing capabilities and unique pore-to-process integration, positioning itself as a leader in deepwater innovation and solutions.