ENSCO Secures 2-Yr Rig Contract

CORRECTION: On Friday March 7, Rigzone reported in a headline that ENSCO 8503 would be operating offshore Newfoundland and Labrador. Henry Goodrich is the rig that will be operating offshore Newfoundland and Labrador, not ENSCO 8503. ENSCO has not released information as to where ENSCO 8503 will be operating as of yet.

ENSCO International Incorporated announced that the Company has entered into a letter of intent from a customer for a drilling contract for ENSCO 8503, an ultra-deepwater semisubmersible rig currently under construction. The contemplated contract will be for a two-year term, with an option for the customer to extend the contract at mutually agreed rates and term. The aggregate day rate revenue for the two-year term is expected to be approximately $372 million. The base operating rate is $510,000 per day, and the day rate will be subject to adjustment for variances in operating costs from current levels. The letter of intent is subject to negotiation and execution of a definitive drilling contract.

ENSCO 8503 is the Company's fourth ultra-deepwater semisubmersible rig in the ENSCO 8500 Series currently under construction, and will increase the Company's deepwater fleet to five rigs inclusive of the ENSCO 7500 deepwater semisubmersible rig that has been in service since 2000. All four of the 8500 Series rigs are under construction by the Keppel FELS Limited Shipyard in Singapore, with deliveries expected in the third quarter of 2008 for ENSCO 8500, the first quarter of 2009 for ENSCO 8501, late in the fourth quarter of 2009 for ENSCO 8502, and in the third quarter of 2010 for ENSCO 8503. All of the ENSCO 8500 Series rigs are now committed to customers for term work commencing upon delivery.

The ENSCO 8500 Series ultra-deepwater semisubmersibles are enhanced versions of ENSCO 7500, and are based upon an ENSCO proprietary design. Enhancements include a two million pound quad derrick, offline pipe handling capability, increased drilling capacity, greater variable deck load, and improved automatic station keeping ability. The rigs will be capable of drilling in up to 8,500 feet of water, and can be upgraded to 10,000 feet water-depth capability if required. With these features, the 8500 Series rigs will be especially well-suited for deepwater development drilling.

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