UPDATE 1-National Oilwell expects offshore rig demand to slow

Mon Apr 28, 2014 12:15pm EDT
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* Reports 1st-qtr orders $2.33 bln vs $3.04 bln year earlier

* Expects demand for new offshore rigs to slow in 2nd half

* Shares fall about 7 pct (Adds details from the statement and conference call, analyst comment, share movement)

April 28 (Reuters) - National Oilwell Varco Inc, the largest U.S. oilfield equipment provider, said orders fell by nearly a quarter in the first quarter and it expects demand for new offshore rigs to slow during the second half of the year.

The company's shares fell about 7 percent.

Demand for contract drilling is softening as rigs ordered during boom times are being delivered now. Large oil companies are tightening spending after a decade of double-digit increase in budgets as oil prices stagnate and project costs rise.

National Oilwell said on a conference call on Monday that its day rates had come under pressure with demand slowing.

Rival Diamond Offshore Drilling Inc warned last week that the next two years could be a tough environment for offshore drillers.

National Oilwell booked $2.33 billion in new orders for oilfield equipment in the first quarter, down from $3.04 billion a year earlier.   Continued...