Deepwater Pathfinder News

Transocean announced its intent to retire the ultra-deepwater floaters GSF Jack Ryan, Sedco Energy, Sedco Express, Cajun Express, and Deepwater Pathfinder, and the deepwater floater Transocean Marianas. The rigs will be classified as held for sale and will be recycled in an environmentally responsible manner. All six rigs were previously cold stacked. The company will recognize an impairment charge of approximately $1.4 billion during the third quarter of 2017 associated with these actions. “We continue to enhance the quality of our fleet through the addition of new, high-specification assets, and the retirement of older, less competitive rigs,” said Jeremy Thigpen, President and Chief Executive Officer.

Transocean Ltd today issued a monthly Fleet Update Summary, which includes new contracts, changes to existing contracts, and changes in estimated planned out-of-service time of 15 or more days since the February 17, 2015 Fleet Update Summary. The total value of new contracts since the last report is approximately $9 million. •             Sedco Express - Awarded a one-well contract extension offshore Nigeria at a dayrate of $300,000 ($9 million estimated backlog). •             Henry Goodrich is idle. •             Ultra-deepwater floaters Discoverer Spirit, GSF Jack Ryan, Deepwater Discovery, and Deepwater Pathfinder are stacked. The rigs were previously idle. •             Estimated 2015 planned out-of-service time decreased by a net 102 days, mainly associated with the Henry Goodrich.

Transocean Inc. announced that its deepwater drillship Deepwater Pathfinder, a single-activity rig capable of drilling in water depths up to 10,000 feet, has been awarded a five-year contract by a subsidiary of Eni for drilling operations primarily in the U.S. Gulf of Mexico. The contract is scheduled to commence in March 2010 following completion of the rig's existing contract commitments. Estimated contract revenues that could be generated over the five-year contract period are approximately $1.19 billion. Estimated contract revenues represent the maximum amount of revenues that may be earned in the contract period, excluding revenues for cost escalations.

Wärtsilä North America signed a contract with Transocean for a Conditioned Based Maintenance (CBM) program. The contract covers three Transocean properties: the Deepwater Millennium and Deepwater Pathfinder drill ships and the Deepwater Nautilus semi-submergible drill rig. Financial terms of the contract were not disclosed. "CBM contracts have been useful in other industries as a way for operators and owners to extract the maximum value out of their maintenance dollars spent," said Steve O'Leary, Technical Field Support Manager for Transocean's North American region. "In this case, Transocean and Wärtsilä are partnering to take an 'intelligent maintenance' approach by evaluating the exact condition of individual engines on a real-time basis.

Stolt-Nielsen S.A. appointed Otto H. Fritzner as CEO of Stolt-Nielsen Transportation Group (SNTG). Fritzner most recently served as Managing Director, Ship Owning at SNTG. He succeeds James B. Hurlock, who was named Interim CEO of SNTG in July 2003. • SNTG's global operations will be organized into three regions - the Americas, administered from Greenwich, Conn.; Asia-Pacific, administered from Singapore; and Europe, the Middle East, India and Africa (EMEIA), administered from Rotterdam, SNTG's corporate headquarters. • SNTG's Indian Ocean Service and the Europe-to-Asia Pacific Service will be operated out of Rotterdam. I.M. Skaugen ASA announced that Skaugen PetroTrans (SPT), its 50 percent owned joint venture company, has appointed Per Voie as its President.

Transocean Inc. said that its ultra-deepwater drillship, Deepwater Pathfinder, has been awarded an 11-well exploration program offshore Nigeria under a drilling services sharing agreement between Nigerian subsidiaries of Devon Energy, ConocoPhillips, ExxonMobil and Royal Dutch Shell. The estimated 475-day exploration program is expected to commence by December 2004, following the rig's completion of a drilling project in the U.S. Gulf of Mexico and estimated 30-day mobilization to Nigeria. Revenues of approximately $90 million could be generated over the 475-day program, exclusive of revenues for mobilization and demobilization of the rig. The Deepwater Pathfinder is a dynamically positioned, ultra-deepwater drillship capable of operating in water depths of up to 10,000 feet.

Shell Nigeria Ultra Deep Limited and Shell Nigeria Exploration Properties Alpha Limited, companies of the Shell Group, announced they have made discoveries in two 'Big Cat prospects'. Further appraisal is required to determine the discoveries' resource potential. The wells, in blocks OPL 322 and OPL 245, were both in frontier areas. Bobo -1X was drilled in block OPL 322, to a total depth of 5,173 m in 2,479 m of water, the second deepest well in offshore Nigeria. Drilling was completed on 16 July 2005, under budget, and found over 140 meters of hydrocarbon bearing sands. Shell Nigeria Exploration Properties Alpha Limited has a 40 per cent shareholding in OPL 322. mEtan -1X was drilled in block OPL 245 to a total depth of 4,574 m in 1,720 m of water.

R&B Falcon Corporation announced drillship Deepwater Pathfinder sustained damage when 20 joints of the vessel's riser and its blowout prevention equipment fell to the seabed in approximately 7,000 ft. of water while preparing to continue drilling operations in the Gulf of Mexico offshore Louisiana. None of the personnel aboard the drillship sustained any injury. The drillship's top drive and travelling equipment sustained damage, and an investigation is underway to ascertain the full extent of damages sustained. The marine integrity of the drillship was not affected. No environmental damage resulted from the incident. Deepwater Pathfinder is operated under a long-term bareboat charter by Deepwater Drilling L.L.C., a limited liability company in which affiliates of Conoco Inc.

According to the U.S. Department of the Interior's Minerals Management Service (MMS), deepwater drilling (1,000 ft. and deeper) shows the greatest potential of development, and certainly has garnered the attention (as well as the E&P dollars) of offshore oil production industry leaders. By yearend 2003, the MMS estimates as much as 63 percent of the oil production and 29 percent of the daily gas production will come from deepwater reserves. In August of 1998 there were 30 (temporary and permanent) deepwater rigs drilling simultaneously in the Gulf of Mexico's Outer Continental Shelf (OCS), at depths greater than this. The proliferation of deepwater development projects will likely continue to grow…

Conoco and R&B Falcon Corp. announced Deepwater Pathfinder - a first-of-its-kind, ultra-deepwater drillship - began a five-year work program in the Gulf of Mexico. The ship, the first new build capable of drilling in 10,000 ft. of water, will fulfill a $400 million drilling program for Conoco. The vessel is expected to drill three or four wells in its first year of operation, with the first exploratory well being drilled at Garden Banks Block 783. Conoco has interests in 295 deepwater leases in the Gulf. The technological highlight of the ship is its dynamic positioning systems, wherein a specialized combination of seabed and satellite systems send signals to onboard computers.

Conoco announced an agreement with Exxon Corporation to exchange interest in 59 deepwater blocks in the Gulf of Mexico. Conoco acquired a 50-percent interest in 29 of Exxon's blocks, while Exxon acquired a 50-percent interest in 30 of Conoco's blocks. Conoco was the sole lessee of its 30 blocks and will retain a 50-percent interest in each. The acreage is in Green Canyon, Garden Banks, Walker Ridge and Keathley Canyon areas in the Gulf of Mexico. "The Gulf of Mexico continues to be one of the great growth opportunities for oil and gas in the U.S., and these newly acquired interests are perfectly aligned with our exploration strategy to focus on deepwater," said Rob McKee, Conoco executive vice-president, exploration production.

R&B Falcon Corporation has confirmed a three-year drilling contract with Texaco for its newbuild 10,000-ft. water depth dynamically positioned drillship Deepwater IV, as a substitute for previously contracted Peregrine VIII. Texaco expects to begin a drilling program offshore West Africa shortly after the vessel's delivery, which is scheduled for the third quarter of 2000. Steve Webster, R&B Falcon's president and CEO, stated, "We are pleased to work with Texaco on its ultra-deepwater drilling program. This contract commitment, recently following the commitment by another deepwater operator for our 5th generation ultra-deepwater semisubmersible RBS8-D, reaffirms our view of the relative strength of the deepwater sector of the offshore drilling industry.

Conoco and Unocal announced a discovery on their K2 exploration well in the Gulf of Mexico on Green Canyon Block 562, about 180 miles south of New Orleans. It is the second consecutive deepwater discovery made this year by the Deepwater Pathfinder drillship. "The sidetracked well has encountered oil in a high-quality reservoir," said Conoco executive vice-president Rob McKee. The well was spudded on May 17 and drilled in 3,900 ft. of water. "We also plan to penetrate some deeper objectives with a different well configuration," McKee said. "We have decided to temporarily suspend the well, which will allow us to plan a safe and cost effective appraisal of the hydrocarbon zone we have encountered, as well as continue to explore the deeper objectives.

R&B Falcon Drilling has received a letter of intent from for Petroleo Brasiliero S.A. (Petrobas) for a two-year contract for DP drillship Deepwater Frontier, for operations offshore Brazil in up to approximately 8,900 ft. of water. Deepwater Frontier, capable of drilling in up to 10,000 ft. of water, is owned 60 percent by R&B Falcon Corp. and 40 percent by Conoco. The vessel will sail to Brazil upon completion of its current one-well commitment in West Africa. Operations for Petrobras are expected to commence in November 1999. The current well underway in West Africa and the Petrobras work, will essentially complete all of the R&B Falcon's 2.5-year drilling contract obligation with respect to the rig sharing agreement with Conoco. Conoco Inc. and Unocal Corp.

R&B Falcon's drillship Deepwater Pathfinder sustained damage recently when 20 joints of the vessel's riser and its blowout prevention equipment fell to the seabed in about 7,000 ft. (2,133 m) of water while preparing to continue drilling operations in the Gulf of Mexico offshore Louisiana. None of the personnel onboard was injured, but the drillship's top drive and traveling equipment was damaged. A full investigation is currently underway to decipher the full extent of the accident.

Conoco Inc. and Unocal Corp. discovered oil with their K2 exploration well in the Green Canyon Block 562 in deep water in the Gulf of Mexico, Conoco said. Work on the well, located about 180 miles (290 km) south of New Orleans, has been suspended to study the significance of the find, a company spokesperson said. The K2 well, started May 17 in 3,900 ft. of water, was suspended to "allow us to plan a safe and cost effective appraisal of the hydrocarbon zone we have encountered, as well as continue to explore the deeper objectives," said Conoco Executive Vice President Rob McKee. McKee also said the well had encountered oil in a high-quality reservoir and the company was encouraged by the results to date, although the commercial significance is yet to be determined.