Transocean Ltd. today announced on Monday it has been awarded 10-year contracts for four new build dynamically positioned ultra-deepwater drill-ships by Royal Dutch Shell (Shell).
Shipyard delivery for the first drill-ship is scheduled for mid-2015. The remaining three drill-ships are expected to be delivered from the shipyard at approximately six-month intervals thereafter. After customer acceptance, the contracts are expected to commence in 2015 and 2016, contributing an estimated revenue backlog of 7.6 billion dollars, excluding mobilization.
The aggregate capital investment for the four new build rigs is an estimated 3 billion, excluding capitalized interest. All four drill-ships have advanced capabilities: each is designed to operate in water depths of up to 12,000 feet and drill wells to 40,000 feet. Featuring state-of-the-art equipment, including Transocean’s patented dual-activity drilling technology, the new build drill-ships will possess industry-leading hoisting capacity.
The drill-ships will also have a variable deck-load capacity of 23,000 metric tons and feature enhanced well completion capabilities. In addition, each new build rig will be outfitted with two 15,000 psi blowout preventers (BOPs), which are expected to reduce customer non-productive time between wells. The four new build drill-ships will be able to accommodate a future upgrade to a 20,000 psi BOP, when it becomes available.
The rigs will also feature diesel engines configured to comply with anticipated Tier III International Maritime Organization (IMO) emissions standards.
“These contracts add 40 years of rig work to our revenue backlog, expand and upgrade our ultra-deepwater fleet, improve our fleet mix and provide an opportunity to expand our relationship with an important customer with which we have 40 years of experience in advancing the state of the art in offshore drilling technology,” said Steven L. Newman, President and Chief Executive Officer of Transocean Ltd.
“We look forward to providing Shell with incremental value through the addition of these seventh-generation, ultra-deepwater drill-ships.”
Peter Sharpe, Shell’s Executive Vice President, Wells, said, “Shell continues to develop its deepwater operations and modernize its contracted rig fleet at fair market rates. These state-of-the-art deepwater rigs, on which we are collaborating with Transocean to design, will comply with the highest industry standards for safety, operations and environmental protection for drilling deepwater wells.”
The new build rigs will be constructed at the Daewoo Shipbuilding and Marine Engineering Co., Ltd. facility at Okpo, South Korea, where Transocean’s five Enhanced Enterprise-Class rigs were built and where the company currently has two other ultra-deepwater drill-ships under construction. Construction on the first drill-ship is expected to commence during the fourth quarter of 2013.