CATEGORIZED | News

Transocean, Petrobras announce 10-year rig deal

Posted on 14 July 2008

The capital lease contract has a 20-year term, after which Transocean will have the right and obligation to acquire the drillship for $1. Total capital costs to be incurred by Petrobras and Mitsui for the construction of the drillship are estimated to be $750 million, including $65 million of capitalized interest.

The 10-year drilling contract is expected to commence in Q3 2009. The drilling contract commencement is contingent on vendor performance and other factors. At least 12 months prior to the expiration of the initial 10-year term, Petrobras may elect to extend the term of the drilling contract by up to an additional 10 years at a mutually agreed operating dayrate, which would then apply to the extension period.

Contract revenues over the initial 10-year contract term are estimated to be $1.68 billion, including monthly bonuses that can be as high as 12% of dayrate revenue each month.

If the rig is operating in a jurisdiction where the company has a valid dual activity patent, an additional 5% royalty would be paid to Transocean.

Transocean CEO Robert L Long said, “This contract is an excellent opportunity to expand our relationship with Petrobras and its partner Mitsui. This unique structure allows us to acquire a newbuild drillship with construction cost protection, while also providing us with rates of return consistent with our other enhanced Enterprise-class newbuilds.”

The currently unnamed ultra-deepwater newbuild drillship is under construction at Samsung Heavy Industries in Geoje, South Korea. The rig will feature Transocean’s dual-activity drilling technology, allowing for parallel drilling operations designed to save time and money in deepwater well construction, compared with conventional rigs. The rig will also feature expanded completions capabilities. It will have a variable deck-load of over 20,000 metric tons and the capability of development and exploration drilling in greater than 10,000 ft of water depth, upgradable to 12,500 ft of water depth and 37,500 ft of total drilling depth with additional equipment.

0 Comments For This Post

1 Trackbacks For This Post

  1. Petrobras (Brazil’s state-run, Soros invested oil company)…. $64.5 Billion stock sale ‘to fund exploration’. | RedState Says:

    [...] In July of 2008, Petrobras signed a ten year contract (+ a ten year extension option) with Transocea…………… “variable deck-load of over 20,000 metric tons and the capability of development and exploration drilling in greater than 10,000 ft of water depth, upgradable to 12,500 ft of water depth and 37,500 ft of total drilling depth with additional equipment.” [...]

Leave a Reply

*

FEATURED MICROSITES


Recent Drilling News

  • 28 July 2014

    SDI completes 500th MagTraC MWD Ranging project

    Scientific Drilling International (SDI) has completed the 500th MagTraC MWD Ranging project. MagTraC was introduced in 1998 to target challenging applications...

  • 28 July 2014

    Modular offshore rig design reduces deployment costs

    William Jacob Management (WJM) has introduced an offshore rig design that reduces deployment costs and improves speed-to-market for upstream operations. The 3,000-hp...

  • 23 July 2014

    Halliburton promotes Jeff Miller to President

    Halliburton has promoted Jeff Miller to President and has appointed him to the Halliburton Board of Directors effective 1 August 2014. Mr Miller is currently the...

  • 23 July 2014

    Statoil resumes production on Njord A platform

    Statoil has resumed oil and gas production on the Njord A platform in the Norwegian Sea, after a major reinforcement of the platform structure. Production had been shut down...

  • 22 July 2014

    Petrobras’ domestic oil production tops 2 million bbl/day in June

    Petrobras’ June oil production in Brazil averaged 2 million bbl/day (bpd), a 1.7% increase from May’s production of 1.9 million bpd. In addition, the production operated...

  • Read more news