Seadrill ltd and its Deepwater Peers have a Big Week

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Deepwater drillers Seadrill, Ocean Rig and Rowan all signed contracts last week as oil and gas drillers like Freeport-McMoRan are finally committing to new deepwater drilling contracts.

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Seadrill ltd and its Deepwater Peers have a Big Week

  1. 1. Seadrill Ltd. and its Deepwater Peers Have a Big Week Photo credit: Seadrill
  2. 2. Ultra-deepwater market The first quarter was the worst quarter for the ultra-deepwater rig market since the financial crisis.
  3. 3. Ultra-deepwater market Only seven ultra- deepwater rig years were contracted in the quarter.
  4. 4. Ultra-deepwater market This quarter is looking much better.
  5. 5. Ultra-deepwater market Last week alone nearly double the number of rig years were contracted.
  6. 6. Ultra-deepwater market Let’s take a closer look at the ultra-deepwater rig market’s big week.
  7. 7. Seadrill signs a five-year deal On June 2, Seadrill signed a $1.1 billion contract with Total for its West Jupiter newbuild drillship. Photo credit: Seadrill
  8. 8. Seadrill Contract details: • Five-year, $1.1 billion contract with Total. • West Jupiter newbuild ultra-deepwater drillship will head to Nigeria for offshore work once complete. • Vessel is expected to be delivered in August. • Dayrate is worth around $600,000 per day.
  9. 9. Ocean Rig signs a six well deal On June 4, Ocean Rig signed a $165 million contract with Noble Energy for its Eirik Raude semi-submersible drilling rig. Photo credit: Ocean Rig
  10. 10. Ocean Rig Contract details: • Minimum six-well program that’s expected to last 260 days. • Eirik Raude is a semi-submersible drilling rig that will head to the Falkland Islands for offshore work with Noble Energy and Premier Oil. • Vessel is expected to commence operations in the first quarter of 2015. • Dayrate is about $560,000 per day.
  11. 11. Ocean Rig signs a six-year deal On June 5, Ocean Rig signed a $1.3 billion contract with Total for its Skyros drillship. Photo credit: Ocean Rig
  12. 12. Ocean Rig Contract details: • Six-year, $1.3 billion contract with Total. • Skyros ultra-deepwater drillship will head to Angola for offshore work. • Vessel is expected to commence operations in the third quarter of 2015.
  13. 13. Rowan signs a two-year deal On June 6, Rowan signed a $425 million contract with Freeport-McMoRan for its Relentless drillship. Photo credit: Rowan Companies
  14. 14. Rowan Contract details: • Two-year, $425 million contract with Freeport- McMoRan. • Relentless ultra-deepwater drillship will head to the Gulf of Mexico for offshore work. • Vessel is expected to commence operations in the third quarter of 2015. • Final drillship under its current construction program.
  15. 15. Investor takeaway: • Last week’s slew of long-term contracts at solid dayrates is a very positive sign for the deepwater industry.
  16. 16. Not only that but these awards are spread across the globe. It shows that drillers like Total and Freeport-McMoRan aren’t giving up on the deepwater anytime soon. Instead, drillers will continue to seek top drillships to search for oil in the deepest parts of the ocean.
  17. 17. The dividend investment the IRS is daring you to make.

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