Weekly Offshore Rig Review: Floating Rig Fans

This week, worldwide offshore rig utilization rose to 83.9%, a rather siginficant jump caused by five idle rigs going on contract in the last week.

In the previous edition of the Weekly Offshore Rig Review, we looked at the companies that are contracting the largest competitive jackup fleets in the world. Ths week, we will continue our examination of leading operators by looking at the companies that are contracting the largest numbers of semisubmersibles and drillships. Looking at this information over the past year and into the future helps to paint a picture of which operators have been and will be the most active.

The table below outlines the leading operators around the globe that currently have the largest fleet of competitive semisubmersible rigs and drillships under contract. In addition, each company's overall share of the competitive floating rig fleet is shown.

Current Leading Operators of Competitive Semisubs and Drillships
As of March 8, 2007
Operator Floaters Share
Petrobras 23 rigs 9.2%
Shell 15 rigs 6.0%
Total 11 rigs 4.4%
BP 11 rigs 4.4%
Chevron 9 rigs 3.6%
Statoil 7 rigs 2.8%
Norsk Hydro 6 rigs 2.4%
Pemex 5 rigs 2.0%
ExxonMobil 5 rigs 2.0%
ENI 4 rigs 1.6%
Anadarko 3 rigs 1.2%
BHP Billiton 3 rigs 1.2%
Hess 3 rigs 1.2%
Nexen 3 rigs 1.2%
Petronas Carigali 3 rigs 1.2%
Reliance Industries 3 rigs 1.2%
Woodside 3 rigs 1.2%
All Other Operators 106 rigs 42.6%
Not Contracted 26 rigs 10.4%

At the top of the list of top floating rig operators is Petrobras, which has the largest fleet by a wide margin. Thanks to Petrobras, state-controlled companies have a sizable share of the semisub and drillship fleet, with the top 6 state companies operating about 19% of the worldwide competitive floating rig fleet. However, this share is much smaller than among the jackup fleet, which had almost 1/3 of the fleet working for state companies.

Looking at the current picture of rig contracts as of today is useful, but a more comprehensive picture can be gained by looking back over a longer period of time. The table below presents the number of competitive floating rigs and days contracted throughout 2006 for the top operators of these rigs that had at least 1,000 rig days contracted during 2006.

Leading Operators with the Most Competitive Semisub and Drillship Days Contracted
For Calendar Year 2006
Operator Floaters Days Contracted Avg Day Rate Total Day Rates Paid
Petrobras 25 rigs 7,521 days $124,816 $964 million
BP 15 rigs 4,495 days $188,126 $927 million
Shell 18 rigs 4,377 days $198,325 $869 million
Statoil 11 rigs 3,602 days $205,627 $676 million
Total 12 rigs 3,497 days $220,821 $820 million
Chevron 14 rigs 2,846 days $201,211 $558 million
Pemex 7 rigs 2,395 days $53,500 $127 million
Norsk Hydro 7 rigs 2,312 days $226,040 $526 million
ExxonMobil 10 rigs 1,992 days $197,423 $387 million
Anadarko 6 rigs 1,918 days $254,827 $498 million
ENI 10 rigs 1,606 days $176,176 $308 million
Hess 5 rigs 1,602 days $169,227 $312 million
Woodside 8 rigs 1,509 days $165,400 $255 million
Talisman 3 rigs 1,089 days $140,000 $164 million

This look at the top floating rig operators continues to show the dominance of Petrobras. The company hired more rigs in 2006 than any other company, as well as contracting about 67% more rig days than the next largest floating rig operator. At the same time, Petrobras has paid some of the lowest day rates of any floating rig operator, with only Pemex paying less per rig day.

The table below presents the operators that have the longest average contract lengths for competitive semisub and drillship contracts that have occured since the start of 2006, including ongoing contracts. Only companies that have had at least four competitive floating rigs contracted since January 2006 are included, and only those companies with average contract lengths greater than the worldwide average length are shown.

Longest Average Contract Lengths
For Contracts Since Jan. 1, 2006
Operator Floaters Avg Contract Length
Pemex 7 rigs 1,339 days
Petrobras 25 rigs 867 days
Statoil 11 rigs 599 days
Reliance Ind. 4 rigs 587 days
BP 15 rigs 475 days
CNR Int'l 4 rigs 464 days
Total 12 rigs 459 days
Chevron 14 rigs 453 days
Norsk Hydro 8 rigs 368 days
Hess 8 rigs 355 days
Worldwide Average 349 days

While all of the operators shown in the table above have longer than average semisub and drillship contract lengths, Pemex and Petrobras stand out from the rest. These two state-owned, Latin American operators both have average contract lengths that surpass all of the other operators by a very large margin. In fact, Pemex contracts are 3.8 times longer than the average contract length, and Petrobras contracts are 2.5 times longer than the average.

Beyond looking at the past and current contracts, we can also look forward to the floating rig contracts that will be ongoing during the next two years. This is a good guide to which operators have the most work planned and have made the most efforts to ensure access to deewpater rig time between now and early 2009. The table below provides the list of operators that have already contracted the most competitive semisub and drillship days for the next two years (includes firm contracts, options, and LOIs).

Leading Operators with the Most Competitive Semisub and Drillship Days Contracted
For the Two Years from March 2007 to March 2009
Based on Contracts Announced as of March 8, 2007
Operator Floaters Days Contracted Avg Day Rate Total Day Rates
To be Paid
Petrobras 26 rigs 15,093 days $172,397 $2,257 million
Shell 24 rigs 10,617 days $275,515 $3,068 million
BP 17 rigs 8,402 days $279,415 $2,571 million
Statoil 13 rigs 7,603 days $289,305 $2,455 million
Chevron 13 rigs 6,947 days $319,743 $2,320 million
Total 15 rigs 6,456 days $286,238 $1,928 million
Anadarko 11 rigs 5,360 days $362,518 $2,169 million
Norsk Hydro 8 rigs 4,877 days $293,988 $1,492 million
Reliance Ind. 7 rigs 4,279 days $335,625 $1,338 million
ExxonMobil 10 rigs 3,987 days $347,321 $1,457 million
Woodside 6 rigs 3,217 days $256,260 $1,000 million

Not surprisingly, Petrobras tops this list as well. The company has over 15,000 deepwater rig days contracted for the next two years, which is almost 50% more than Shell in second place. Another interesting point is that Petrobras will continue to pay significantly lower day rates than other operators over the next two years. For the other ten operators listed above, the average floating rig day rate to be paid over the next two years is $304,593. This is more than 75% higher than the average day rates to be paid by Petrobras.

For More Information on the Offshore Rig Fleet:
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