In spite of hurricane damage and rising equipment costs, the majority of the oil-service companies on the Oil and Gas Investor This Week scoreboard reported revenue growth and improved dayrates in the third quarter. Though many analysts feared the storms would yield miserable revenue declines, consistent drilling activity at increasing prices was enough to keep the group's winning streak in place. "Pricing gains continued in the quarter," reports Susquehanna Financial Group's analyst Kevin Wood. "We estimate oilfield prices improved 3% sequentially and 15% year-on-year." He anticipated service companies would realize sequential pricing gains of 3.4% on average in the third quarter, led by higher prices for pressure pumping, coiled tubing, wireline logging services, and drillpipe and tool rentals. Attractive drilling prospects at current oil and gas prices and a shortage of rig equipment are catapulting dayrates for offshore as well as onshore rigs. "Jackups in the Gulf of Mexico have begun to sign meaningfully higher rates, well beyond our original expectations," reports Angeline M. Sedita, senior vice president of oil-service equity research at Lehman Brothers. (For more on this, see "Trends & Analysis," Oil and Gas Investor, December 2005.) Additional third-quarter revenue-growth winners include National-Oilwell Varco Inc., Patterson-UTI Energy Inc., Unit Corp. and Cal Dive International at 100%, 81%, 61% and 59%, respectively. The biggest winners in earnings per diluted share, however, were Diamond Offshore Drilling, Halliburton and Rowan Cos. at 2,900%, 956% and 644%, respectively.

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