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January 17, 2006

Smedvig orders another tender rig

Norwegian drilling contractor Smedvig has lately been in the headlines as the subject of an acquisition offer by John Fredriksen's SeaDrill.

Today, however, the news from Smedvig is that it has entered into an agreement with Malaysia Marine & Heavy Engineering Sdn Bnd in South Malaysia.

The agreement covers construction of a new self erecting tender rig, T-10. The new barge unit is scheduled for delivery at the end of the second quarter 2007, and capital expenditure is estimated to approximately US$ 89 million, including the derrick equipment set, where Smedvig's ownership share is 49 percent.

The tender rig will be similar to Smedvig's T-9, but with enhanced drilling capabilities allowing for parallel activities and significantly increase drilling efficiency. The new unit will be particularly well suited for production drilling in shallow and deepwater areas in Southeast Asia.

Smedvig has been awarded a letter of intent for the new rig from Carigali Triton in Malaysia . The production drilling assignment has a duration of approximately three years, and the contract value is estimated to US$ 84 million. Commencement of operations will follow delivery of the rig at the end of the second quarter 2007.

Carigali Triton has also sgned a new contract with Smedvig for the tender rig Teknik Berkat. The contract has a duration of 18 months, commencing in the third quarter 2007 in direct continuation of the current contract. The contract value is estimated to approximately US$ 36 million.

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