Two leading offshore drilling contractors – Ensco and Rowan Companies – have agreed to merge creating an industry-leading drilling contractor capable of working across all water depths with a truly global footprint, a Rystad Energy analysis shows.
The combined fleet will encompass 82 units made up of 28 floaters and 54 jackups. A total of 38 units out of the jackup fleet and 11 units of the floater fleet are high spec, giving the combined company one of the most capable fleets in the industry.
Through the merger with Rowan, Ensco will enter the harsh-environment Norwegian market where it had previously not had a footprint. This also creates the largest marketed, high-spec jackup drilling contractor in the Gulf of Mexico. The combined company will be very well positioned to benefit from the upturn in the offshore drilling sector.
Among the benefits of the merger is the large customer base the newly combined company will have across majors, national oil companies and smaller independents. Many of the largest operators, such as Saudi Aramco, BP, Chevron, ExxonMobil and Shell as well as smaller operators like Cantium, GulfSlope, Fieldwood and Castex will benefit from economies of scale and operational expertise across the globe.
The combined company’s balance sheet is estimated to have liquidity of approximately $3.9 billion, including $1.9 billion of cash and short-term investments providing financial flexibility. Total estimated revenue backlog for the combined entity is approximately $2.7 billion, excluding ARO Drilling’s backlog.