Norway: Statoil Hires West Hercules Rig from Seadrill

Statoil has signed a contract with North Atlantic Norway to hire the West Hercules rig which can be used for exploration and production drilling internationally and on the Norwegian continental shelf (NCS).

Statoil has signed an agreement with North Atlantic Norway Ltd (Norwegian Branch), a company in the Seadrill group, for hire of the West Hercules rig for use on exploration prospects and production licences. The semi-submersible rig will be deployed to start drilling from Q3 2012.

“With its many capabilities, West Hercules will contribute to maintaining a sustainable activity level of exploration, and also to execute on our company’s ambitious exploration strategy in the years to come,” says Tim Dodson, Statoil’s executive vice president for Exploration.

 “Inclusion of this rig in our portfolio provides the necessary flexibility we are looking for and it supports our earlier communicated strategy of revitalising the NCS with high value barrels and deliver on our exploration programme globally. Acquiring this rig is an important contribution to securing Statoil’s rig capacity.”

The daily rate for the rig is USD 490.000. A mobilisation fee of USD 50 million is also payable. The contract is for a fixed four-year period. Statoil has secured a one-year option on the same conditions.

The potential contract revenue value is US$787 million, including US$50 million in mobilization fee, said Seadrill on it website.

Statoil’s focus continues to be on bringing more modern and flexible rigs to our portfolio,” says Jon Arnt Jacobsen, Statoil’s chief procurement officer.

“West Hercules is the first-available suitable rig which is already in operation. This, together with its advanced capabilities such as deep waters, high pressure/high temperature and completion, has prompted Statoil to act on this opportunity. This modern rig will be complementary to our portfolio and bring us more flexibility. It will be utilised on targeted wells internationally and on the NCS.”

West Hercules is a sixth generation, high specification, deep water, semi-submersible drilling unit, built in 2008. It has a high load carrying capacity and an efficient drilling floor layout with improved safety and working environment measures.

Alf C Thorkildsen, Chief Executive Officer in Seadrill Management AS “We are pleased to secure a long-term contract for one of our most advanced ultra-deepwater rigs. This assignment reflects the growth in demand for premium rigs and allows West Hercules to utilize its deepwater and harsh environment capabilities. We are delighted to extend our relationship with Statoil, as a key client and as one of our longest standing business partners.”

West Hercules can run parallel drilling operations and is designed with a dynamic positioning system and a water depth capacity up to 3,000 metres. West Hercules is expected to complete a three-year contract for Husky Oil China Ltd for operations off China in May 2012.

Source:Statoil / Seadrill ,September 9, 2011;

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