Transocean Sedco Forex Awarded Contracts
Transocean Sedco Forex Inc., announced that it has been awarded new contracts for its high-specification semisubmersible rigs Cajun Express and Sedco Express. Ocean Energy Inc. for ultra-deepwater drilling operations on the company's South Titan prospect located in approximately 6,200 feet of water in the U.S. Gulf of Mexico. The contract should commence following the completion of the rig's current drilling assignment with Ocean Energy in the U.S. Gulf of Mexico. Revenues to be generated over the estimated 40-day contract period could total approximately $6 million. The Sedco Express has been awarded a three-well, estimated 130-day contract from a unit of BP for drilling operations in the Eastern Mediterranean offshore the coast of Egypt in waterdepths between 2,600 feet and 3,280 feet.
Offshore News
R&B Falcon Confirms U.S. Reading & Bates Development Co. (DEVCO), a wholly owned subsidiary of R&B Falcon Corporation, announced its Boomvang Project in deepwater offshore Texas is proceeding rapidly. DEVCO concurs with previously announced reserve estimates of 70-100 million boe in several oil reservoirs extending across portions of East Breaks Blocks 642, 643, 688 and 732. Platform, production facilities and pipeline contracts are being evaluated, and development drilling is scheduled to begin in the second quarter of this year. The partners anticipate first production in the first quarter of 2002. DEVCO owns a 50 percent working interest in the Boomvang Project. Kerr-McGee Oil & Gas Corp., a wholly owned subsidiary of Kerr-McGee Corp. is operator and owns a 30 percent working interest.
Newfield Signs Purchase and Sale Agreement to Acquire GOM Assets
Newfield Exploration Company announced it has signed a purchase and sale agreement to acquire the interests of Ocean Energy, Inc. in three shelf Gulf of Mexico fields. The purchase price is approximately $66 million and the transaction was expected to close by mid-August. Newfield explores, develops and acquires oil and gas properties principally in the Gulf of Mexico.
ING Raises Ratings On Oil Companies
ING Barings has raised its ratings of the shares of several oil and gas companies. ING raised Burlington Resources to strong buy from hold, Transocean Offshore to strong buy from buy and Ocean Energy Inc. to buy from hold. On Transocean, analyst Stephen Gengaro wrote: "We believe the stock has lagged the group because of the relatively high level of contract rollovers over the next six months, which includes some of the company's high-specification semis currently working at high day rates. "While these rollovers will likely keep pressure on earnings over the next several quarters, we do not expect the company to sign any long-term contracts…
Offshore: ABS to Class Cell Spar for Kerr-McGee
ABS is classing the industry's first cell spar destined for Kerr-McGee's Red Hawk field in deepwater Gulf of Mexico. The project marks ABS' fifth classification contract from Kerr-McGee Oil & Gas for a spar offshore facility. The project will draw on ABS' experience with spar technology and industry expertise for deepwater developments, says Luiz Feijo, ABS project manager. "ABS offers Kerr-McGee the expertise to face the technical challenges of the Red Hawk frontier project while meeting the schedule requirements," said Feijo. The entire project, adds Feijo, is expected to complete within two years of project sanction, with first-gas scheduled for second quarter 2004. "Engineering and fabrication are proceeding in parallel.
