The oil markets have been in freefall in recent weeks, with both crude and refined products falling to price levels not seen since the beginning of this decade. There are various causes – estimates of economic growth and petroleum demand have been revised downward, and there have been rumblings of a possible price war between OPEC and non-OPEC oil producers.

As you’d expect, many oil and oil-related stocks have taken a beating due to this turn of events. But stock mavens may have overreacted: U.S. economic growth will continue to ensure a steady demand for most petroleum products, and the oil market itself may be touching bottom and ready to head back upward.

One good play on this trend is Seadrill (NYSE: SDRL), an offshore oil drilling company domiciled in Bermuda and headquartered in London. The company has significant operations in all the major regions of the world and also has strong growth prospects. But its stock is down more than 30 percent in recent months – due more to the general oil price trend than to anything specific to this firm.

The market for offshore drilling rig and equipment stocks should begin an upswing soon, as the supply of new rigs will slow dramatically even as development drilling picks up. So even with all the headlines about lower oil prices, Seadrill still has a built-in basis for expansion.

The company’s growth plans are ambitious. Seadrill secured a contract with Total Upstream Nigeria Ltd. for employment of the ultra-deepwater drillship West Jupiter, in support of the EGINA ultra-deep offshore project in Nigeria. The contract is for a firm period of five years and has a total revenue potential for the primary contract term of approximately $1.1 billion.

The West Jupiter is one of eight 6th generation drillships currently under construction for Seadrill and is expected to be delivered from the Samsung Heavy Industries shipyard in Geoje, South Korea in a few months.  The rig will be outfitted to work in up to 10,000 feet of water and is capable of water depths up to 12,000 feet and drilling depths up to 37,500 feet.

Per Wullf, Seadrill’s CEO, remarked, “We are very pleased to have been chosen by Total and its partners for this important project. This contract provides an opportunity to deepen our relationship with a key customer and strategically increase our rig fleet in Nigeria, adding the West Jupiter alongside the West Capella which has been operating in the Usan field Offshore Nigeria since 2008.”

Additionally, North Atlantic Drilling Ltd. and Seadrill have signed an agreement with Rosneft in order to pursue growth opportunities in the Russian market through at least 2022. As part of these proposed opportunities, NADL will enter the onshore drilling market in Russia and enter into contracts for multiple offshore assets. In addition Rosneft will be acquiring a significant equity stake in NADL. NADL has already contracted to drill the first two wells in the Kara Sea, as part of Rosneft and Exxon’s joint venture during 2014 and 2015.

NADL is an offshore harsh environment drilling company with focus on the North Atlantic basin. The company has nine drilling units in the fleet, including five semi-submersibles, a drillship, and three jack-up rigs. Seadrill Limited currently owns 70% of the outstanding shares and the company is listed on the NYSE and Norwegian OTC with a market capitalization of approximately $2.1 billion.

As part of the agreement, a number of long term contracts for NADL’s near-term availability are expected to be signed as well as a commitment to future contracts and new projects. The Agreement envisions initial employment of up to 9 offshore rigs to Rosneft with a total commitment of 35 rig years. Seadrill, after the initial transaction, will remain the largest shareholder in NADL. 

Alf Ragnar Lovdal, Chief Executive Officer of NADL, commented, “We have sought to access the growth opportunity represented by the Russian market for several years, and we are very pleased to have reached an agreement with Rosneft for this landmark transaction.  The Russian market is one of the most attractive opportunities in the world and offers tremendous growth potential for North Atlantic Drilling.”

The decline in oil prices can’t go on forever, and in fact the latest figures from the Energy Department – which tracks petroleum production and demand – already provide some basis for a recovery. When that happens, undervalued companies like Seadrill will prosper. It’s a buy up to 30.

Tom Scarlett is an investment analyst at Personal Finance.