Pride to Build New Ultra-Deepwater Drillship

Pride International will construct an advanced-capability, dual activity drillship for use in ultra-deepwater drilling locations. The new rig will be capable of drilling in water depths of up to 12,000 feet, with a total vertical drilling depth of up to 40,000 feet. The rig, to be constructed by Samsung Heavy Industries Co., Ltd. (SHI) on a fixed-price basis, is expected to be delivered from the shipyard in the third quarter 2010, following construction, commissioning and system integrated testing.

Louis A. Raspino, president and chief executive officer of Pride International, stated, "Customer requirements for deepwater drilling capacity continue to expand, as successful results in exploration drilling lead to prolonged field development programs around the world, placing deepwater assets in short supply beyond the end of the decade. As a result of activity levels, it has become increasingly difficult to match shipyard delivery dates with customer requirements. Our commitment to build this unit was initially driven by the need to protect the delivery date necessary to meet a specific customer requirement. While we have not reached an agreement with that customer, we do believe it is important to proceed given the long-term market outlook and attractive delivery date."

Raspino added, "We are highly confident that the favorable conditions in the deepwater sector will persist, producing attractive contracting opportunities for deepwater drilling rigs. As a result, we are committing to the construction of this premium asset, demonstrating continued progress toward our strategic direction of expansion in the deepwater sector.

"The addition of this premium, ultra-deepwater rig to our fleet, which currently ranks second in the industry for dynamically positioned, deepwater drilling units, improves our ability to prosper in the long-term strength of the deepwater market and better serve our customers' needs worldwide," Raspino said.

The new drillship, to be named at a later date, is based on an SHI proprietary hull design measuring 750 feet long, 140 feet wide and offering a variable deck load of 20,000 metric tons. The rig will feature dynamic positioning station-keeping with DPS-3 certification. In addition, the rig will have dual activity capabilities, designed to save customers time during the well construction process when compared to conventional single activity rigs. The company has obtained a license from the patent holder to utilize the dual activity technology.

The rig will also have expanded drilling fluids capacity, a 1,000 ton top drive and living quarters for up to 200 personnel. The drillship will be constructed at the SHI shipyard in Geoje, South Korea and will be initially equipped for drilling in water depths up to 8,000 feet. The expected fixed-price project cost of the rig, including commissioning and system integrated testing, is approximately $680 million, excluding capitalized interest. The company expects to fund the cost of the rig through available cash and borrowing against its revolving credit facility.