Citi Comments On Hercules Offshore Debt

According to Citi, Hercules Offshore HERO it believes the risk/reward has tilted more in HERO's favor following its comments that jackup demand may be improving in the Gulf of Mexico. Citi said that although HERO is not out of the woods yet in terms of managing down its debt to avoid a possible future equity raise, the next two fleet status reports should indicate more clearly whether or not its customer conversations will be translated into firm rig commitments. “Overall, the jackup picture is brightening for HERO given the improving dynamics in the GOM (declining supply, utilization at 75%-85%) and cyclical traction overseas (utilization now 90%+).” Hercules Offshore closed on Friday at $4.65.