During the period under review, the Company achieved strong operating growth in its all four business segments.
For the nine months ended 30 September 2004, the total number of wells drilled increased by 29% to 182, of which 135 were development wells and 47 were exploration wells. The Company's jack-up drilling rigs operated for a total of 2,666 daysfor the nine months ended 30September 2004, an increase of 535 days or 25% as compared to the corresponding period of 2003, and its semi-submersibles operated for a total of 785 days, an increase of 88% as compared to the corresponding period of 2003. Average utilization rate of the rigs for the nine months ended September 30, 2004 reached 100%.
The Company's well services recorded remarkable growth for the nine months ended September 30 2004. Number of jobs for logging increased by 53% to 464 wells. The number of wells for which the Company provided drilling fluids services, directional drilling services, cementing services and well completion services surged 73%, 71% , 74% and 80% , respectively.
As for the marine support and transportation services front, the Company's marine support vessels attained an average utilization rate of 99.1% for the nine months ended September 30, 2004, as compared to 96.3% in the same period of 2003. The Company's marine support vessels operated for a total of 16,043 days, an increase of 2,205 days or 16% as compared to the same period of 2003.
COSL's geophysical services consist mainly of the collection and processing of 2D and 3D seismic data. For the nine months ended September 30, 2004, the Company's collection of 3D seismic data increased by 52% to 2,681 km2 while collection of 2D seismic data decreased slightly by 5% to 35,637 km. The Company also achieved an impressive increase of 55% and 86% in the processing of 2D seismic data and 3D seismic data, respectively.
The shipyard construction of the new 400 feet jack up rig has been commenced while the second-hand jack-up rig "COSL 931" purchased in July 2004 has been sent to the shipyard for overhaul. "COSL 931" is expected to commence operation in November 2004.
Two new standby vessels were added to the Company's fleet in August and September 2004. During the first nine months of 2004, a total of six new working vessels have been delivered. As of September 30, 2004, the Company owns a fleet of 69 vessels (including 5 oil tankers). Three more new vessels are expected to be delivered in the fourth quarter of 2004.
In August 2004, the Company was awarded a bid of submersible electronic pump in Indonesia. The total amount of this five-year well services contract exceeds US$30 million.
Commenting on the Company's future strategy, Mr. Yuan Guangyu, CEO and President of COSL, said, "Looking ahead, leveraging on our robust fleet capacity, prominent operational efficiency, extensive business network and unrivalled competitiveness, we are confident of capturing immense market potential brought forth by increasing exploration and development activities in offshore China. COSL is committed to further enhancing its capacity and implementing effective business strategies, for creating profitable returns to our shareholders"
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