Rig briefs: KCA DEUTAG awarded contract worth up to $2.2 billion; Keppel delivers Super A Class jackup

KCA DEUTAG awarded contract worth up to US $2.2 billion

KCA DEUTAG has been awarded a contract with Statoil for the management, operation and maintenance of two Category J jackups, which will operate on the Norwegian Continental Shelf (NCS). The contract is for eight years with the option to extend by four periods of three years, giving potential for the contract to last up to 20 years. The contract value is US $900 million (NOK 5.2 billion) for the initial period and US $2.2 billion (NOK 12.8 billion) including options. Operations are expected to start in 2016 to 2017.

The new Category J rigs will be able to operate in harsh environments at water depths from 230 to 460 ft (70 to 140 meters) and drill wells with lengths up to 32,800 ft (10,000 meters). Each tailor-made rig will be owned by the Oseberg and Gullfaks licenses and be specifically designed to operate on both surface and subsea wells.

The contract adopts an innovative approach where the licenses own the rigs instead of the drilling contractor. “This is an important milestone for both Oseberg and Gullfaks. The awards will secure vital rig capacity for both licenses at very competitive prices. Reduced drilling costs are important to increase recovery and to maintain production in Oseberg Area Unit and Gullfaks for decades,” Øystein Håland, head of Operations West in Statoil, said.

During the initial engineering and construction phases, a joint Statoil and KCA DEUTAG team will work alongside Samsung Heavy Industries and National Oilwell Varco at the shipyard. “This award enhances our already significant business in Norway and also sets a precedent for KCA DEUTAG to target further drilling operations and management contracts on newbuild mobile offshore drilling units that are third-party owned,” Norrie McKay, CEO of KCA DEUTAG, said. KCA DEUTAG also operates eight other platform-drilling rigs for Statoil on the NCS.

Keppel delivers first KFELS Super A Class jackup for harsh environments

Keppel FELS has delivered its first KFELS Super A Class jackup to Discovery Offshore, which is managed by Hercules Offshore.

Discovery Triumph has been delivered 46 days ahead of schedule and with a perfect safety record. The ultra-high-specification jackup has been designed for the harsh environmental conditions of the North Sea (UK sector). Its enhanced leg design incorporates Keppel’s high-capacity rack and pinion jacking system, which ensures that the rig is able to jack up and stand firm in a secure and safe manner in challenging environments.

“We are pleased that Discovery Offshore has selected this design for their first two harsh environment rigs,” Wong Kok Seng, managing director, offshore, for Keppel Offshore & Marine and managing director of Keppel FELS, said. “Although it is a new design, our expertise and strong engineering, construction and project management experience has enabled us to deliver it ahead of schedule while achieving an excellent safety record. We look forward to delivering the second KFELS Super A Class to Discovery Offshore just as efficiently.”

Discovery Triumph is capable of operating in water depths of 400 ft and drilling depths of 35,000 ft. The KFELS Super A Class is equipped with pinion overload detection, rack phase difference detection, and brake failure and overload protection devices. The rig has a 2 million-lb hook-load drilling system and includes a spacious deck and amenities to accommodate 150 workers.

“As this North Sea-compliant rig is able to operate efficiently in virtually all parts of the world outside Norway and the Arctic, we also see many opportunities for it to be deployed in other parts of the world to generate maximum utilization. With another KFELS Super A Class rig about to join Discovery Triumph later this year, we are well positioned to become a strong player in harsh environment drilling,” John T. Rynd, CEO of Hercules Offshore, said.

Keppel FELS is currently building another KFELS Super A Class jackup for Discovery Offshore, as well as another three for Ensco.

Diamond Offshore orders semisubmersible, secures three-year drilling contract with BP

Diamond Offshore Drilling has ordered a new Moss CS60E design harsh-environment from Hyundai Heavy Industries. The 10,000-ft dynamically positioned rig is expected to be delivered after November 2015. Projected capital cost of the unit, including spares, commissioning and shipyard supervision, is approximately US $755 million.

Diamond Offshore secured a three-year drilling contract with a subsidiary of BP to utilize the rig for initial operations off the coast of South Australia. The initial operating dayrate is $585,000 per day and is subject to upward adjustment for certain increased operating costs and equipment modifications.

“We are pleased to have been selected by BP for this important work,” Larry Dickerson, Diamond Offshore’s CEO, said. “Our company, and its predecessors, have been continuously active in Australia since 1982, drilling over 600 wells – far more than any other drilling contractor.”

BP also has exercised a one-year option for use of Odfjell Drilling’s Deepsea Stavanger. The extension will keep the rig with BP in Angola as a minimum until November 2014. Deepsea Stavanger has been drilling under contract with BP Angola since 2011. The rig is currently drilling and completing production wells on the Greater Plutonium field in Block 18. The contract has two more one-year options.

Atwood Oceanics secures contract for the Atwood Eagle

Atwood Oceanics has been awarded a drilling services contract for the Atwood Eagle semisubmersible. This contract is for 24 months and will be performed offshore Australia at a dayrate of approximately US $460,000. Contract commencement is expected in June 2014 in direct continuation of present operations, which have been split between BHP Billiton, Apache Energy and Woodside Energy. With the award of this contract, the firm contractual commitment for the Atwood Eagle is expected to extend to June 2016.