Ensco (ESV), the world’s second-largest offshore drilling company, represents a strong play on high oil prices as crude once again approaches $100 a barrel. Based in London, Ensco trails only Transocean (RIG) in size.

Given rising oil demand in much of the world, Ensco’s services will be at a premium. Offshore drilling is starting up again in the United States and will likely intensify, particularly if a Republican is elected president next year. Meanwhile, offshore opportunities abound elsewhere in the world.

Ensco gained an entrance to Brazil and West Africa as part of its $7.3 billion purchase of Pride International earlier this year. Those are two of the world’s fastest-growing markets for offshore drilling. It was the Pride acquisition that established Ensco as the No. 2 player in the industry.

The company expects $100 million of savings next year from the merger. Ensco is renowned for keeping costs low and profit margins high.

Thanks to a $1.3 billion, 10-year fleet upgrade program that started 1996, Ensco’s fleet of jackup rigs has an average age of only 10 years, a third of the industry average, according to Morningstar.

Impressive earnings

Ensco’s profit soared 57 percent in the third quarter to $204.5 million from $130.4 million a year earlier. Revenue more than doubled to $915.6 million

Standard & Poor’s analyst Stewart Glickman has a four-star buy rating on Ensco shares. “While ESV has two un-contracted newly built deepwater units, including the DS-6 due for delivery in early 2012, we note positive trends in this segment and think the DS-6 will generate solid day rates and term length,” he writes.

As a result, Glickman recently raised his share price target by $4 to $65. That represents a 27 percent premium to recent levels.

Ensco is next scheduled to report Feb. 2.