Transocean Inc. Announces Contract for Dhirubhai Deepwater KG2 and Dhirubhai Deepwater KG1 Contract Conversion to Five Years
HOUSTON, April 7, 2008 (PRIME NEWSWIRE) -- Transocean Inc. (NYSE:RIG) today announced that the ultra-deepwater drillship Dhirubhai Deepwater KG2 (formerly Deepwater Pacific 2), which is owned by a joint venture in which the company has 50 percent interest, has been awarded a five-year drilling contract from Reliance Industries. The contract is expected to commence in the first quarter 2010 following shipyard construction, sea trials, mobilization to India and customer acceptance.
Contract revenues which could be generated over the first six months and remaining 54 months of the contract period are estimated to be $90 million and $838 million, respectively.
In addition, Transocean announced that the first ultra-deepwater drillship owned by the joint venture, Dhirubhai Deepwater KG1 (formerly Deepwater Pacific 1), has now had its previously announced four-year contract extended by Reliance to five years. Contract revenues which could be generated over the first six months and remaining 54 months of this contract period are estimated to be $90 million and $838 million, respectively. The drilling contract is still expected to commence in the third quarter of 2009, following shipyard construction, sea trials, mobilization to India and customer acceptance.
In October 2007, Transocean announced that a subsidiary exercised its option to purchase a 50 percent interest in a joint venture company with Pacific Drilling Limited ("Pacific Drilling"). The joint venture company owns the two ultra-deepwater Samsung-design drillships that are currently under construction in South Korea.
The two drillships are currently under construction at Samsung Heavy Industries' shipyard in South Korea where the Transocean subsidiary is overseeing construction. The new drillships feature National Oilwell Varco drilling packages that include advanced offshore drilling technology, including significant off-line tubular-handling and stand-building capabilities, advanced mud system designs, advanced systems for building, storing and running several subsea trees and efficient riser and BOP (blowout preventer) handling systems. The drillships will have a variable deckload of approximately 20,000 metric tons.
Dhirubhai Deepwater KG1 will be equipped to work in water depths of up to 12,000 feet and outfitted to construct wells up to 35,000 feet deep. The estimated delivered cost for the Dhirubhai Deepwater KG1, including customer reimbursed equipment, is approximately $685 million, excluding capitalized interest.
Dhirubhai Deepwater KG2 will be equipped to work in water depths of up to 10,000 feet and outfitted to construct wells up to 35,000 feet deep. The estimated delivered cost for the Dhirubhai Deepwater KG2, including customer reimbursed equipment, is approximately $685 million, excluding capitalized interest. Construction is expected to be completed in the fourth quarter of 2009.
Statements regarding estimated contract revenues, estimated delivered costs, future contract commencement dates, or completion of construction, as well as any other statements that are not historical facts in this press release, are forward-looking statements that involve certain risks, uncertainties and assumptions. These include but are not limited to operating hazards and delays, risks associated with international operations, risks inherent in shipyard projects (including delays and cost overruns), actions by customers and other third parties, the future prices of oil and gas, and other factors detailed in the company's most recent Form 10-K and other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated.
Transocean Inc. is the world's largest offshore drilling contractor and the leading provider of drilling management services worldwide. With a fleet of 138 mobile offshore drilling units plus eight ultra-deepwater units under construction, the company's fleet is considered one of the most modern and versatile in the world due to its emphasis on technically demanding segments of the offshore drilling business. The company owns or operates a contract drilling fleet of 39 High-Specification Floaters (Ultra-Deepwater, Deepwater and Harsh-Environment semisubmersibles and drillships), 29 Midwater Floaters, 10 High-Specification Jackups, 56 Standard Jackups and other assets utilized in the support of offshore drilling activities worldwide. With a current equity market capitalization of approximately $45.6 billion, Transocean Inc.'s ordinary shares are traded on the New York Stock Exchange under the symbol "RIG."
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CONTACT: Transocean Inc.
Guy A. Cantwell