Ocean Rig snaps up drillship at auction for $65M

Ocean Rig UDW Inc., a global provider of offshore deepwater drilling services, has acquired the drillship Cerrado for $65 million. 

Ocean Rig’s subsidiary bought the 6th generation ultra-deepwater drillship Cerrado through an auction for a purchase price of $65 million. Ocean Rig said on Monday the purchase would be funded with available cash on hand.

The drillship was previously owned by Schahin Oil and Gas that filed for bankruptcy protection in April last year as it was unable to pay its debts.

The drillship Cerrado was under a contract with Brazilian state-owned oil company Petrobras, and the Brazilian company drilled the first exploration well in the Libra area, offshore Brazil, with this drillship. However, Petrobras cancelled its leases for five offshore oil drilling and production vessels, including Cerrado, with Schahin in May 2015.

The drillship was built at Samsung Heavy Industries in 2011 to similar design specifications as Ocean Rig’s existing 6th generation drillships built at Samsung, and will be renamed the Ocean Rig Paros upon its delivery to Ocean Rig.

For comparison, total yard cost of Ocean Rig’s drillship ordered at Samsung Heavy in 2011 was $608 million.

Another subsidiary of the company has been acting as the manager of the drillship for its previous owners. The transaction is expected to close upon completion of the judicial auction procedure.

Ocean Rig CEO George Economou hinted in August 2015 that Ocean Rig would be interested in buying assets from its peers distressed by the industry downturn.

Offshore Energy Today Staff

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