Hercules Offshore, Inc., a jack-up drilling and liftboat contractor, today completed
the previously disclosed acquisition of a fleet of eight liftboats from Danos
& Curole Marine Contractors, LLC for $44 million. Three of the acquired
liftboats have leg lengths ranging from 130 to 230 feet and are located in the
U.S. Gulf of Mexico. These liftboats are currently operating under short-term
contracts. A fourth liftboat located in the Gulf of Mexico was damaged during
and its condition is being evaluated.
The remaining four liftboats, which have leg lengths ranging from 130 to
170 feet, are currently operating in Nigeria. Danos & Curole will continue to
operate these four vessels under an operating agreement until Hercules has
established its own operations in Nigeria. This operating agreement expires
in September 2006, and can be terminated earlier by Hercules upon 30 days'
notice to Danos & Curole.
If the vessel damaged in Hurricane Katrina is determined to be a
constructive total loss, the purchase price will be reduced by the amount of
insurance proceeds Danos & Curole recovers. However, if the vessel can be
repaired, Danos & Curole will conduct the repairs and Hercules will pay a
portion of the salvage cost and reimburse any deductible amounts Danos &
Curole is responsible for under its insurance policies covering the vessel.
Danos & Curole would deliver the vessel to Hercules upon completion of repairs
without payment of any additional consideration.