Aker Solutions to provide drilling package for DSME drillship newbuild

Aker Solutions has won a contract from Daewoo Shipbuilding & Marine Equipment to supply a complete drilling equipment package for a new deepwater drillship.

The contract is worth about NOK 540 million. The drillship will be owned and operated by Tungsten Explorer Company, a subsidiary of Vantage Drilling Company (NYSE Amex: VTG).

“We are very pleased to have won another contract to deliver our deepwater drilling equipment and systems, which underlines our strong and fruitful relationships with the yard and the team at Vantage Drilling” says Thor Arne Håverstad, executive vice president and head of Aker Solutions’ drilling technologies business.

Bill Thomson, VP Assets and Engineering at Vantage Drilling says: “We appreciate the commitment by Aker Solutions to provide a drilling package that meets and exceeds our expectations. This will be the seventh drilling package from Aker Solutions that Vantage will be involved in. As such Aker Solutions’ commitment to deliver not only an excellent service during the construction but to provide a first-class customer service when in operations is important to the success of Vantage Drilling. “

The equipment will mainly be delivered in 2012.

Vantage Drilling announced the order for the drillship on May 5, saying that the cost of the ship, to be named Tungsten Explorer, including all project management, commissioning, spares, pre-delivery crew costs and inventory was estimated to be approximately $580 to $590 million. The company has also obtained a fixed price option for the purchase of an additional drillship.

Tungsten Explorer will be constructed at DSME’s shipyard in Okpo, Korea, and will be capable of operating in water depths up to 12,000 feet, with a total vertical drilling depth capacity of 40,000 feet. The hull design has a variable deck load of 20,000 tons and measures 781 feet long by 137 feet wide. The drillship will be equipped with features that include DP3 dynamic positioning system, 1,250 short ton hook load drilling package, a 9,000 hp drawworks, as well as offline pipe handling and trip saver system. The drillship will have accommodations for 200 personnel.

Paul Bragg, the Company’s Chairman and CEO, commented, “The addition of Tungsten Explorer to our fleet is an exciting development. While this will be our second company-owned unit to be constructed at DSME, it will be our fifth drillship project undertaken there, inclusive of our three ongoing construction oversight projects. Our strong relationship with the DSME management has allowed us to achieve exceptional project terms — a) one of the lowest cost construction contracts of this kind, (b) one of the earliest deliveries of the recent order cycle — just 24 months away, and (c) one of the highest specification ultra-deepwater units yet to be built.

“We are also very pleased that payment terms provide for an initial down payment of just slightly over $100 million, with the balance of the contract price due at delivery in May 2013. We plan to debt finance the down payment in connection with our planned refinancing of some of our existing high cost debt.”

June 17, 2011