Tong Chong Heong, Managing Director/Chief Operating Officer of Keppel Offshore & Marine and Mr Carl F. Thorne, Chairman and Chief Executive Officer of ENSCO International after contract signing
January 20, 2006
ENSCO orders further ultra deepwater semi at Keppel FELS
ENSCO International Incorporated (NYSE:ESV) says that a wholly-owned subsidiary has entered into a drilling contract to provide a new ultra-deepwater semisubmersible drilling rig, to be named ENSCO 8501.
The drilling contract is with Nexen Petroleum U.S.A. Inc., a subsidiary of Nexen Inc. (NYSE:NXY) and with Noble Energy, Inc. (NYSE:NBL) is for a firm three and a half year primary term, with four one-year extension options at mutually agreed day rates.
The term commitment comprises a two year obligation by Nexen and a one and a half year obligation by Noble Energy. Day rate revenue during the primary term is expected to total approximately $423 million. ENSCO will also be reimbursed for mobilization and other start-up costs, and day rates will be adjusted for future variances in operating costs.
ENSCO has entered into an agreement with Keppel FELS Limited in Singapore to construct the new ENSCO 8501. The total project cost of the new rig is currently expected to be approximately $338 million, with mobilization to the Gulf of Mexico anticipated by the second quarter of 2009.
ENSCO 8501 is the company's second semisubmersible in the 8500 series, and its third deepwater semi, joining ENSCO 7500, delivered in 2000, and ENSCO 8500, which is expected to be delivered in the second quarter of 2008.
The ENSCO 8500 Series deepwater semisubmersibles are an enhanced version of the ENSCO 7500. The 8500 Series rigs will be capable of drilling in up to 8,500 feet of water, and can readily be upgraded to 10,000 feet water-depth capability if required.
Enhancements include a two million pound quad derrick, offline pipe handling capability, increased drilling capacity, greater variable deck load, and improved automatic station keeping ability.
Each rig is fitted with a DPS2 dynamic positioning system and eight 2,600 kW thrusters .
Carl F. Thorne, ENSCO's Chairman and Chief Executive Officer, commented: "We are pleased to have entered into a second transaction of this type in the last few months. As with the ENSCO 8500 project, ENSCO 8501 is expected to provide a cost-effective deepwater drilling solution for our customers and expand ENSCO's deepwater capability on a conservative and financially attractive basis. We are gratified to again be working with Keppel FELS shipyard on the ENSCO 8501. We highly value our longstanding relationship which has resulted in a history of successfully delivering high-quality newbuild rigs on time and within budget."
Keppel FELS Limited (Keppel FELS) has secured a repeat order for an ultra-deepwater semisubmersible drilling rig from a wholly-owned subsidiary of ENSCO International Incorporated (ENSCO). The total project value is approximately US$338 million.
The pontoons and lower hull columns of the ENSCO 8500 and 8501 will be built in the Keppel Philippines shipyard in Batangas. When completed, these modules will be transported to Keppel FELS in Singapore to be assembled with the other parts of the semis.
“We expect to cut the first steel for the ENSCO 8500 semi in Keppel Batangas shortly,"said Mr Choo Chiau Beng, Chairman & CEO of Keppel Offshore & Marine.
“This strike steel event is significant to the Keppel Offshore & Marine group, because it marks Keppel Batangas’ entry into the offshore sector as demand for offshore drilling rigs continues to rise," he said.
Apart from the two ENSCO semis, Keppel FELS is currently constructing three other semis, undertaking a major conversion of a semi and fabricating 15 jackups.
Tomorrow, January 21, 2006, Keppel FELS is also expected to deliver the KFELS B Class jackup rig, ENSCO 107, to ENSCO one month ahead of contractual schedule with a clean safety record of zero incidents. It is the eighth jackup rig that the Keppel O&M group has completed for ENSCO since 1999.