KCA Deutag Lands 6-Rig Contract in Caspian Region by BP

KCA Deutag has been awarded a flagship six-rig contract by BP as operator of the Azeri-Chirag-Gunashli and Shah Deniz fields in the Azerbaijan sector of the Caspian Sea, to manage all of BP-operated platform drilling assets in the Caspian region.

The contract, which is for a primary period of five years with the option to extend by up to a further five years, is believed to be the world's largest single platform drilling contract. The new contract will commence in December 2010.

Holger Temmen, KCA Deutag's Chief Executive, commented, "We are very pleased to have won this long term contract award for all of BP-operated platforms in such a key strategic market. We have a valued relationship with BP in the Caspian region, developed over more than a decade, and focused on continuous improvement at all levels. KCA Deutag is now one of the largest employers in Azerbaijan, and this award is very much a reflection of the quality of our Azerbaijani workforce and their hard work and dedication. This major contract win proves the strength of KCA Deutag and its ability to generate recurring revenue."

Rune Lorentzen, KCA Deutag's General Manager - Northern Platforms, said, "This award reinforces the importance of our focus on consistently high HSE and operational performance. Drilling facilities design and platform drilling operations remain absolutely core to KCA Deutag's strategy and the BP Caspian involvement is perhaps the best example of our preferred contracting model - being involved from the early conceptual engineering stages, through front end and detailed engineering, construction and subsequent long term operation of the rigs. It has been a very successful period for our platform business and reflects our ongoing commitment to improving performance and in delivering safe, effective, trouble-free operations."

The contract covers platform drilling operations and maintenance services on the Central, East and West Azeri, Chirag, Deepwater Gunashli and Shah Deniz platforms, and employs some 700 KCA Deutag staff both on and offshore, of which over 500 are Azerbaijani citizens. On the Chirag platform the rig is owned by KCA Deutag and leased to BP.

KCA DEUTAG's involvement in Azerbaijan commenced in 1997 with the conversion and mobilisation of their landrig T-105 for the Chirag platform. This was followed in November 1997 with the award, initially, of conceptual study work on Central Azeri leading to the front end and detail design and subsequently the operations and maintenance contracts on the platform. In fact KCA Deutag, via its engineering division RDS, has been involved in the design of all subsequent platform rigs for BP in the Caspian region and is presently engaged in the detail design of the next platform rig for the Chirag Oil Project. This next platform is due to be installed in 2013 and the operation of the rig will automatically fall under this new contract with KCA Deutag.