Chiles Offshore Llc News

Keppel FELS Limited (KFELS), the offshore arm of Keppel FELS Energy & Infrastructure Ltd. (Keppel FELS), has signed a contract with Chiles Offshore LLC (Chiles) to build a $110 million jack-up rig of KFELS MOD V "B" design, cantilevered jack-up rig. Work is expected to start immediately, with delivery scheduled for around the second quarter of 2002. This rig is one of KFELS' ultra-premium proprietary jack-up designs which has been modified in this case for non-harsh environment usage. It is designed to be able to exceed the operating capabilities of conventional non-harsh environment jack-up rigs and will be built to a leg length of 475 ft., with an option to extend this to 545 ft. "Our goal is to augment our position in the ultra-premium, deep-water jack-up market niche.

Chiles Offshore LLC, the 55-percent owned unit of offshore oil exploration company Seacor Smit Inc., has filed for an initial public offering of 8 million common shares in a range of $17-$19 each. Chiles owns and operates ultra-premium jack-up drilling rigs -- mobile offshore drilling platforms with legs that lower to the ocean floor to support the platform while drilling. Ultra-premium rigs differ from other drilling rigs because of their greater depth capabilities and more powerful mud pumps that speed up well drilling. According to papers filed with the Securities and Exchange Commission, the Houston-based firm has applied for an American Stock Exchange listing. A ticker symbol will be disclosed later.

Chiles Offshore LLC is the operator of three of seven existing ultra-premium jackup drilling rigs, all of which currently operate in the U.S. Gulf of Mexico. The company owns two of these rigs, the Chiles Columbus and the Chiles Magellan, and operates the third, the Tonala, under a bareboat charter. Ultra-premium jackup drilling rigs are differentiated from other jackup drilling rigs primarily by their greater water depth capabilities, an ability to extend the drilling system over larger fixed offshore platforms and more powerful mud pumps that allow them to drill wells faster and more reliably than other rigs. A fourth ultra-premium jackup rig is being built in Singapore and expected for delivery during the second quarter of 2002. On Feb.

Seacor Smit noted that its Board of Directors had raised its previously announced securities repurchase program by $55 million - resulting in an approximate increase of $73.5 million available to the Company for such purposes. The securities covered by the repurchase program include the Company's common stock, its 5 3/8 percent convertible subordinated notes due 2006, its 7.2 percent senior notes due 2009 and the 10 percent senior notes due 2008 of its affiliate Chiles Offshore LLC. The repurchase of securities would be conducted from time to time through open market purchases, privately negotiated transactions or otherwise, depending on market conditions.

Seacor Smit Inc. announced net earnings for the third quarter ending Sept. 30 of $5 million on revenues of $71.9 million. Results for the quarter included a charge of $2.6 million for additional income tax expense related to the company's decision to liquidate a foreign joint venture, and an extraordinary gain of $890,000 relating to the early retirement of debt. In the same period a year ago, Seacor earned $26.4 million, on revenues of $100 million. Results for the quarter ending Sept. 30 included a loss of $789,000 related to Seacor's investment in Globe Wireless LLC that is accounted for under the equity method. Results for the quarter also included a loss of $347,000 related to its investment in a majority-owned subsidiary, Chiles Offshore LLC.

Chiles Offshore has raised $15 million through the sale of equity interests to its current equity holders. The proceeds were used by the company to repurchase and retire $15 million aggregate principal amount of its 10% Senior Notes due 2008, resulting in $95 million of Senior Notes remaining outstanding after the repurchase. Following such repurchase, the banks party to the company's existing $25 million credit facility increased the available credit under such facility to $40 million and extended the final maturity for such facility from December 31, 2004 to December 31, 2006. Chiles Offshore owns and operates two new LeTourneau Enhanced and Super 116 class cantilevered drilling units designed to operate in up to 375 ft.

Chiles Offshore LLC has begun a bareboat charter arrangement with Perforadora Central of Mexico City, who is the owner of the Mobile Offshore Drilling Unit, Tonala. Designed by LeTourneau, Tonala is a super 116-C cantilever jackup able to work in up to 350 ft. of water, built for Perforadora by TDI Halter Marine. Completed this past January, Tonala is expected to enter service in mid-March 2000, where it will commence a contract with CNG Producing Company to drill two wells in the U.S. Gulf of Mexico over the course of 60 days.