Freeport-McMoran (NYSE: FCX) capex cuts could impact Noble Corp (NYSE: NE) and Rowan Cos. (NYSE: RDC), according to Evercore ISI analyst James West.

Earlier Freeport-McMoran said capital expenditures for 2016 and 2017 have been reduced further from $2.0 billion per year in 2016 and 2017 to $1.8 billion in 2016 and $1.2 billion in 2017, including idle rig costs.

Commenting on developments, West said, "The revised capex budget incorporates plans to idle two of the company's three contracted deepwater Gulf of Mexico drillships, putting Noble Corp. (NE) and/or Rowan Companies (RDC) at risk".

"While the company remains in 'ongoing discussions with its rig vendors and other service providers to obtain reductions in costs and to evaluate opportunities to market idled equipment to third parties,' we believe the two higher priced Noble drillships could be at risk while the company continues to operate the lower priced Rowan Relentless," continued the analsyt.

West added, "FCX's most recently approved permits are for work with the Rowan Relentless, and we would not be surprised if Rowan successfully negotiates blend and extend contracts for this and at least one of its three other drillships rolling off contract within a 10-month period in 2017-2018. Offshore rig contracts generally allow for standby rates that cover operating costs plus margin protection, and we would expect the idle rig contractor to quickly minimize costs while on standby."