This week, worldwide offshore rig utilization moved only slightly, continuing to hold near the 82% mark.
The last week has seen some major news on the investment front, with three drilling contractors making major share purchases of smaller players. The largest and most notable of these is Noble's acquisition of a 29.8% stake (39.2% of the "A" shares and 8.9% of the "B" shares) in Smedvig for nearly $688 million. But in addition to this major investment, several smaller deals have been afoot, with SeaDrill acquiring a 39.5% stake in Mosvold and Petrolia Drilling taking a 14.2% ownership of Petromena.
Let's take a look at the players involved in these deals.
A Look at the Noble and Smedvig Rig Fleets
Smedvig is the largest owner and manager of self-erecting tender rigs, with a fleet of 9 tenders working in South East Asia, 2 tenders offshore West Africa, and 1 under construction in Singapore. These 12 tenders account for nearly 50% of the entire worldwide tender fleet and give Smedvig 3 times as many tender rigs as its next largest competitor, Transocean, which owns 4 tender rigs. Smedvig's fleet of active tenders are all currently under contract, generating well over $500k per day in combined revenue. Of these 11 active tenders, 9 have long-term contracts extending out to 2007 and beyond, which guarantees high utilization and increasing revenues from this portion of Smedvig's fleet.
In addition, Smedvig manages a total of 23 platform rigs and owns a small fleet of high-specification mobile rigs in the North Sea. This fleet is composed of 2 semisubs, 1 drillship and 1 jackup, as well as one new $550 million 6th-generation semi under construction at the Samsung Yard in South Korea. These 4 active MODUs are all currently under contract and earn a combined total of over $650k per day.
A Look at the SeaDrill and Mosvold Rig Fleets
Currently, Mosvold does not own any active offshore rigs. It's only drilling asset is a $451 million, 10,000 ft drillship that is under construction at Samsung's shipyard in South Korea and scheduled to be delivered in 2008.
A Look at the Petrolia and Petromena Rig Fleets
Like Mosvold, Petromena's sole offshore rig asset is a 10,000 ft 6th-generation semisub that is being built at the Jurong Shipyard in Singapore. This $423 million rig started construction in November and is scheduled to be delivered in 2010.
Of course, this trend towards mergers and acquistion is not unique to the drilling side of the business. Just this week, ConocoPhillips agreed to acquire Burlington Resources for $35.6 billion. As companies throughout the industry continue to experience strong revenues due to increased oil demand, further consolidation is likely, and many analysts are looking to 2006 to be one of the busiest acquisition years ever.
For More Information on the Offshore Rig Fleet:
Most Popular Articles