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Moratorium forces Diamond’s Ocean Endeavor from GOM

Posted on 09 July 2010

Diamond Offshore Drilling Inc.'s deepwater semisubmersible Ocean Endeavor.

Diamond Offshore Drilling Inc.'s deepwater semisubmersible Ocean Endeavor.

The uncertainty in the deepwater Gulf of Mexico is having the predicted effect of driving high-quality rigs out of the market. Latest news, announced by Diamond Offshore Drilling Inc, is that its deepwater semisubmersible Ocean Endeavor will move from the GOM to Egypt under a term contract with into a term contract with Burullus Gas Company. The contact extends until 30 June, 2011, plus an option. Diamond Offshore said that the rig will mobilize for Egypt immediately.

“With new contracting severely restricted in the GOM as a result of the uncertainties surrounding the offshore drilling moratorium, we are actively seeking international opportunities to keep our rigs fully employed. This new contract for the Endeavor will help us preserve backlog, and will allow the previous operator of the rig to satisfy its contractual obligations which extended until June 30, 2011,” said Diamond Offshore President and CEO Larry Dickerson. “We greatly regret the loss of US jobs that will result from this rig relocation.”

The new contract, combined with a $31 million early termination fee paid by the previous operator of the rig, is expected to generate combined maximum total revenue of approximately $100 million.

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