Offshore Deepwater Brazil Sevan Drilling’s Big Dig

By Claudio Paschoa
Thursday, September 12, 2013
Jon Willmann CFO of Sevan Drilling (Photo: Claudio Paschoa)

Up until 2011, Sevan Drilling was part of Sevan Marine, which builds FPSOs. In 2011 Sevan Drilling was separated from Sevan Marine becoming an independent company. Sevan Drilling was established by Sevan Marine in 2006 for the purpose of building state-of-the-art, ultra deepwater drilling rigs based on the Sevan 650 design, commonly known as the bucket design.
Later the same year, Sevan Marine completed a private placement for the purpose of financing, in part, its drilling business, and an order for Sevan Driller was placed with China Ocean Shipping (Group) Company (COSCO) in 2007.
Sevan Drilling owns and operates two rigs of the cylindrical Sevan design. Both rigs have long-term charter contracts with Petrobras in Brazil for deepwater and ultra-deepwater plays including the pre-salt.
In March 2013, Jon Willmann CFO and Deputy CEO for Sevan Drilling, gave a presentation at the exclusive Hotel Santa Teresa in the hills overlooking Rio de Janeiro. According to Willmann the company has a management and operating organization well positioned for further growth, sans the financial difficulties that afflicted Sevan Marine in 2012.
Willmann explained that its four high-end UDW rigs have a unique and cost effective design and have proven to be safe and efficient for operations in ultra deep waters worldwide, including Brazil, West Africa and the U.S. Gulf of Mexico.
“Sevan Drilling has a perpetual license with Sevan Marine for use of the Sevan design for drilling purposes,” Willmann said. “The company has approximately 481 employees based in Brazil, Norway and China.”
“This month, Sevan Drilling signed a three-year charter contract for operations in the U.S. GoM with LLOG Bluewater Holding LLC. This rig, now named Sevan Louisiana, is currently under construction at the Cosco Quidong shipyard in China, and will be used for this contract,” said Willmann.
The rig is scheduled for delivery in Q4 2013, with operations set to start in January 2014, with a total value of the charter contract in excess of $550m. Willmann also explained that due to this new contract, Sevan Drilling will establish a Houston office to support its GoM operations, where it expects new charter contracts to be forthcoming.
When asked about their relationship with Petrobras, he said “Petrobras has been extremely supportive of both Sevan Marine and Sevan Drilling. Without Petrobras neither company would be in the market today. Petrobras betted on us, awarding contracts without any track record, which is pretty bold and they have been extremely important in developing our company. That said, they do not operate as a charity and are a very professional company. We have had to demonstrate operationally that their trust was well placed.”
“The Sevan design has some competitive advantages. The motion characteristics are better than those of semi-subs or drillships. This better sea performance equates to longer uptime for the operator. From an environmental perspective, the second factor is that our design has a moon pool, and a semi-sub does not. The risers and the drill strings are protected in this moon pool, whereas in a semi it is just open sea with no protection whatsoever. Our units are also cheaper to build, so we do not need the peak rates to generate returns.”
Regarding prospects for the coming five years, Willmann said, “Since November 2011, Seadrill acquired Sevan Marine’s stake in Sevan Drilling. Seadrill is the world’s most successful operator. There is however a high financial risk associated with Sevan Drilling coming from the fact that we have high leverage. The most important step going forward is to deleverage the company. We are aggressively amortizing the debt that we have today. In addition, rigs three and four have much lower Capex than the previous two and they are exposed to a market with much higher day rates than the first two. Assuming market rates for those two units, this will generate deleveraging for the company and will give us better financial flexibility. If you measure risk by operational leverage: debt to EBITDA, we are aiming to move from a net ratio of more than eight down to three in 2015 when all four rigs are on contract, assuming that all rigs are at market rates. The key will be to get contracts for rigs 3 and 4. Rig 3 is already contracted, so we must concentrate on chartering rig 4. We then have options for a further two rigs from COSCO.”

Sevan 650 design characteristics
•    Large load carrying capacity
•    Low roll and pitch motions
•    Simple structural layout – simple to build
•    Lower cost to build and operate
•    Offers a very stable drilling platform to meet growing need for low cost-efficient operations

Deepwater exploration drilling requirements
•    The number of exploration and appraisal wells is expected to rise by 50% within 2020
•     Discovered resource volumes are becoming increasingly drilling intensive
•     Pre-salt drilling requires much more rig capacity per well
•     Leading to a step increase in rig demand while number of wells are fairly flat from 2008 to 2013


Sevan Drilling – Fleet Capabilities

Ultra deepwater capabilites
•    Capable of drilling in water depths up to 10,000 feet.
•    Upgradable to 12,000 feet.

Storage capacity

•    2.5–3.0 times deck load capacity of a sixth generation semi-submersible unit.

Environmental advantages

•    Zero discharge capabilites.
•    Double sides – double bottom.
•    Drilling through moon pool.

Operations and uptime – Sevan Driller
•    95.9% technical uptime
•    98.9% commercial uptime
•    Planned maintenance and marine hull survey completed January.
•    Petrobras’ “Bad Sonda” rating system: (Scale 1 to 10): 9.3
•    Operations and uptime –
   
Sevan Driller
Sevan Driller achieved a technical uptime of 99.7% in April 2013. In Q1 2013 Sevan Driller had a technical uptime of 72.7% and a commercial uptime of 69.8%.

Sevan Brasil:

Sevan Brasil achieved a technical uptime of 96.0 % in April 2013. Following the settlement of disputed hours related to the repair of an electrical switchboard, the commercial uptime for Sevan Brasil in January 2013 is 80.5%. The technical uptime for January was 97%. In Q1 2013 Sevan Brasil had a technical uptime of 92.4% and a commercial uptime of 95.4%.

Sevan Drilling Operational Update for January 2013

Sevan Driller:
Sevan Drilling performed required maintenance on the dynamic positioning and electrical systems on the rig and the three-year compulsory marine hull survey in January. Sevan Driller returned to a new location in Santos Basin and started required testing of the rig on the new location on 24 January. The required maintenance and inspection work took 5 days longer than originally estimated. Sevan Driller achieved a technical uptime of 73% in January 2013.

Sevan Brasil:
Sevan Brasil achieved a technical uptime of 97.0% in January 2013.

Sevan Drilling Rig no 3:

Construction of Sevan Drilling Rig no 3 (Sevan Louisinana) is progressing according to plan and reached 68.2% overall completion in January 2013. Commissioning of the first systems, diesel generators, was initiated in January 2013.

Sevan Drilling Rig no 4:
Construction of Sevan Drilling Rig no 4 is also progressing according to plan and reached 54.4% overall completion in January 2013. Lifting of modules up to upper deck is complete and the drill floor, living quarters and derrick will be lifted and integrated to the main hull in March 2013.



Sevan Brasil
The construction of the UDW Sevan Brasil took place at the Cosco Quidong Shipyard. Sevan Brasil is of the same design as Sevan Driller. Sevan Brasil is contracted to Petrobras S.A. on a six year contract for drilling operations offshore Brazil. The Rig was accepted by Petrobras in July 2012 and spudded it‘s first well on August 31 in Santos basin at a water depth of 1800 m.

Design:    Sevan 650
Yards:    Cosco Shipyard, China
Client:    Petrobras S.A.
Field/area:    Pre-salt Brazil
Water/Drilling depth    3,000 m / 12,000 m
LOA (Length)    86 m
Breadth    75 m (at waterline)
Depth    24.5 m
Displacement    55,800 mT at 12.5m draft


(As published in the August 2013 edition of Maritime Reporter & Engineering News - www.marinelink.com)

Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Transas: The Bridge to Tomorrow

Transas was founded in 1990, by a group of former navigators and engineers, who at that time envisioned ways in which computers could revolutionize maritime safety, communications and security.

ZF Celebrating 100th Anniversary

2015 marks the 100th anniversary of the foundation of ZF Friedrichshafen AG   Zahnradfabrik GmbH was founded in 1915, and through a 100-year history has developed

Signal Ship Repair Achieves OSHA Milestone

Signal International announced that on December 31, 2014, the Signal Ship Repair Operations located in Mobile, Alabama achieved one full year and worked 387,926 manhours,

Shipbuilding

Shepler’s New Ferry Takes Shape

Sparks are flying on the bulkhead and engine room of the $3.8 million, 85-foot Miss Margy, the newest addition to the Shepler’s Mackinac Island Ferry fleet, at Moran Iron Works.

The Art of Propeller Making

The world’s biggest propellers have their cradle in the North of Germany. MMG – Mecklenburger Metallguss GmbH – has manufactured for more than 65 years propellers for ships,

LEEVAC Launches First PSV for Tidewater

On Tuesday, January 27, LEEVAC Shipyards Jennings, LLC launched hull 367, a platform supply vessel (PSV) designed by LEEVAC Design Services, LLC (300 DE-52 HAB PSV).

Offshore

Wärtsilä Propulsion Solution for 3 Tugs

Three large new escort tugs contracted by Norwegian operator Østensjø Rederi, will feature Wärtsilä dual-fuel (DF) engines integrated with a customized gas storage

Russia – Turkey Gas Pipeline Approved

Ankara hosted today a working meeting between Alexey Miller, Chairman of the Gazprom Management Committee and Taner Yildiz, Turkish Minister of Energy and Natural Resources.

Greatship to Buy PSV

Greatship (India) Limited (GIL), a wholly owned subsidiary of The Great Eastern Shipping Company Limited, has signed a contract to buy a 2015-built 4000 dwt Platform Supply Vessel (PSV).

Finance

Denmark's Budget Gap May Flirt with EU Limit if Oil Stays at $50

Denmark's government estimates its budget would lose 7.5 billion Danish crowns ($1.1 billion) if oil prices remained around $50 a barrel, according to a document

Sweden-Poland Maritime Link Improved

The EU's TEN-T Program will co-fund with over €2 million the development of the sea ports of Trelleborg (Sweden) and Świnoujście (Poland), to increase their competitiveness and sustainability,

West Coast Port Talks Clear Hurdle

Shipping companies and the union for 20,000 dockworkers at nearly 30 U.S. West Coast ports have cleared a major hurdle in their protracted labor talks, clinching

Energy

US House Passes Bill to Pressure Regulators on LNG Exports

The U.S. House of Representatives passed a bill on Wednesday to speed permits for exports of natural gas, a measure that even if passed by the Senate and signed into law by President Barack Obama,

Denmark's Budget Gap May Flirt with EU Limit if Oil Stays at $50

Denmark's government estimates its budget would lose 7.5 billion Danish crowns ($1.1 billion) if oil prices remained around $50 a barrel, according to a document

NewLead Holdings Acquire 5 Vessels

NewLead Holdings Ltd. announced today that it recently added five bitumen tanker vessels to its fleet. The Company has expanded its fleet to 10 vessels in less

Offshore Energy

Wärtsilä Propulsion Solution for 3 Tugs

Three large new escort tugs contracted by Norwegian operator Østensjø Rederi, will feature Wärtsilä dual-fuel (DF) engines integrated with a customized gas storage

Greatship to Buy PSV

Greatship (India) Limited (GIL), a wholly owned subsidiary of The Great Eastern Shipping Company Limited, has signed a contract to buy a 2015-built 4000 dwt Platform Supply Vessel (PSV).

US Proposes Allowing Oil, Gas Drilling off Atlantic Coast

The Obama administration on Tuesday proposed allowing for the first time oil and gas exploration in a wide swath of U.S. waters off the Atlantic Coast.   The

 
 
Maritime Careers / Shipboard Positions Maritime Standards Pipelines Pod Propulsion Salvage Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2917 sec (3 req/sec)