In other words, it will take more to convince the skeptics. Seadrill should easily deliver at least $4 earnings per share for the year, but these developments are already priced in, and since the acquisition of Aquadrill earlier this year the valuation has returned to high levels.

Furthermore, daily rates are well below expectations: around $300,000 per day, or 30% below the optimistic projections of analysts at the time of the last restructuring - the second in five years. As activity rates are correct - with 93% of the fleet in use - we can deduce that the market's overcapacity problem has not been fully purged.

At least the offshore drilling sector can look forward to tangible signs of recovery. The majors' exploration budgets are back on track, and new deposits are being uncovered off Surinam, Namibia and Egypt. Other projects in the Gulf of Guinea and Australia could soon be given the green light.

Activity is holding steady in French Guiana, where Exxon is operating its fifth major development, and is picking up significantly in Brazil and Saudi Arabia, where shallow-water drilling has doubled over the past eighteen months. This momentum is set to continue as long as oil prices remain around $70-$80 a barrel.

However, Seadrill has the advantage of a balance sheet with no net debt and a relatively modern fleet. The Board of Directors sees the current valuation - roughly ten times earnings, i.e. an earnings yield of 10% - as a valid opportunity to carry out major share buy-backs.

It's not clear that this short-term gratification makes much sense for the company, especially with the current cost of capital - Seadrill has just refinanced its debt at 8.4%. On the other hand, it could well support the share price, and allow Elliott to exit at attractive levels.