Hercules Offshore OK from Gustav, Keeps Its Eye on Ike

Hurricane Ike
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Hercules Offshore, Inc. has reported that all of its drilling rigs, liftboats and marine vessels located in the U.S. Gulf of Mexico have been accounted for and appear to have sustained no damage as a result of Hurricane Gustav. The Company conducted an aerial inspection of the rigs, liftboats and vessels on September 2, 2008. In addition, all of the evacuated drilling rigs located in the U.S. Gulf of Mexico and inland waterways have been boarded and surveyed by offshore personnel.

As of today, all of the Company's contracted drilling rigs have resumed operations, except for three drilling rigs on stand-by and one drilling rig that was recently re-evacuated as the Company takes precautions as it monitors Hurricane Ike.

All of the Company's contracted offshore rigs remained on full operating dayrate during the evacuation and storm, with the exception of the Hercules 350, which had completed operations for one operator at the time of the evacuation and had the commencement of its operations with its new customer delayed for approximately five days, and the Hercules 252, which earned approximately 50% of its full operating day rate for a period of five days.

The Company may experience a further delay in mobilizing Hercules 350 to its next location due to Hurricane Ike. The Company's barge rigs that were on contract at the time of the storm also remained on full operating dayrate, except, due to special circumstances, five barge rigs that earned approximately 75% of their operating dayrate during the week of the evacuations and interruption of operations due to the storm.

The Company's contracted liftboats located in the U.S. Gulf of Mexico remained on-hire during the evacuation period, commencing on August 29th, at approximately 40% of the operating dayrate. The Company expects a majority of these liftboats will be returning to service by today, returning to the operating dayrate.

The majority of Delta Towing vessels were unable to perform their normal operations during the storm and have therefore been off-hire since August 29th. The Company expects that all of Delta Towing's operating marine vessels should return to normal operations by mid-week, as access roads and ports are cleared and open.

The Company is monitoring the progress of Hurricane Ike and may limit the redeployment of drilling rigs, liftboats and other marine vessels and, if conditions warrant, commence the evacuation and securing of its offshore assets.

John T. Rynd, President and Chief Executive Officer, stated, "Our extensive hurricane and crisis management planning proved to be effective in safely evacuating our personnel and helped to ensure that our rigs and vessels weathered the storm without damage or environmental incident. This preparation and planning has also helped us to quickly return to our normal operations. I am grateful for the excellent performance of our entire operational staff and offshore crews. We remain prepared to secure our crews and our rigs if Hurricane Ike continues on its projected path."

Read more on preparations for Hurricane Ike in Rigzone's Special Coverage Preparing for Ike to Strike.
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