Transocean Inc. to Commence Sedco 700-Series Upgrade Following Commitment from Shell
HOUSTON, Nov 07, 2005 (BUSINESS WIRE) -- Transocean Inc. (NYSE:RIG) today announced that it hasentered into an agreement with an affiliate of Royal Dutch Petroleum(Shell) for the upgrade of one of Transocean's Sedco 700-seriessemisubmersible rigs. Under the terms of the agreement, Shell hascommitted to a firm period of three years under a drilling contract tobe finalized by the parties based upon stated drilling contractprinciples. Shell is entitled to extend the term of the contract byany period up to a maximum of two years by exercising an extensionoption. The rig is expected to complete the necessary shipyard work inapproximately May 2007 and is scheduled to commence drillingoperations following rig commissioning and customer acceptance. Shellreserves the right to terminate the contract should the shipyard worknot be completed by February 15, 2008. The Sedco 700-seriessemisubmersible will be selected from Transocean's fleet of OtherFloaters. Revenues of approximately $385 million could be generatedover the firm three-year contract duration, excluding revenues formobilization, de-mobilization and client reimburseables. Revenueswhich could be generated during the option period are subject tomutually agreed dayrates.
The upgrade of the Sedco 700-series unit is expected to commencein early 2006 at a shipyard to be determined. The estimated cost ofthe upgrade, which includes dynamic positioning station keeping andwater depth drilling capability up to a maximum of 6,000 feet, is $300million depending on final unit technical specifications and otherfactors.
Once completed, the upgraded Sedco 700-series unit will increasethe company's High-Specification Floaters fleet to 33 units, with 29of the units capable of operating in water depths of 4,500 feet andgreater.
Statements regarding contract duration, operational commencementdate, revenues, upgrade costs, shipyard commencement and completion,finalization of the drilling contract, as well as any other statementsthat are not historical facts, are forward-looking statements thatinvolve certain risks, uncertainties and assumptions. These includebut are not limited to operating hazards and delays, actions bycustomers and other third parties, the future price of oil and gas,the actual revenues earned and other factors detailed in the company'smost recent Form 10-K and other filings with the Securities andExchange Commission (SEC), which are available free of charge on theSEC's website at www.sec.gov. Should one or more of these risks oruncertainties materialize, or should underlying assumptions proveincorrect, actual results may vary materially from those indicated.
Transocean Inc. is the world's largest offshore drillingcontractor with a fleet of 92 mobile offshore drilling units. Thecompany's mobile offshore drilling fleet, consisting of a large numberof high-specification deepwater and harsh environment drilling units,is considered one of the most modern and versatile in the world due toits emphasis on technically demanding segments of the offshoredrilling business. The company's fleet consists of 32High-Specification Floaters (semisubmersibles and drillships), 24Other Floaters, 25 Jackup Rigs and other assets utilized in thesupport of offshore drilling activities worldwide. With a currentequity market capitalization in excess of $19 billion, TransoceanInc.'s ordinary shares are traded on the New York Stock Exchange underthe symbol \"RIG.\"
SOURCE: Transocean Inc.
Transocean Inc., HoustonAnalyst Contact: Jeffrey L. Chastain, 713-232-7551orMedia Contact: Guy A. Cantwell, 713-232-7647