Paragon Offshore plc President and Chief Executive Officer Randall D. Stilley spoke recently at the Pareto Securities Oil and Offshore Conference in Oslo, Norway.
In prepared remarks, Randall D. Stilley commented on the strength of the business, steady market outlook for the standard specification jack-up business, and Paragon’s history of delivering safe, reliable, and cost effective services to its customers.
“I am confident in Paragon’s position in the standard specification drilling market,” Randall D. Stilley said.
“Paragon enjoys a backlog of $2.3 billion as of June 30, 2014, stretching into 2017. Furthermore, we anticipate announcing new contracts and contract extensions in a variety of regions in the coming months that will extend our backlog and further demonstrate the continued marketability of our rigs.”
Stilley also addressed Paragon’s capital allocation strategy. “Management and the board of directors are committed to the long-term strength of Paragon and to increasing shareholder value. Our board is currently discussing our strategy for capital allocation, including our dividend policy, and the Company anticipates making an announcement regarding this topic by the end of September.”
Stilley concluded, “The fundamentals of our business are strong, our operations are proceeding well, and our customers have been very supportive of Paragon’s strategy and position in the market. We look forward to taking advantage of opportunities to grow our business in the coming years.”
To remind, Paragon Offshore, a standard specification offshore drilling company was recently created as Noble Corporation’s spin-off.
The company classifies rigs as standard specification vs. “high specification” based on a number of factors, including age, technological capabilities, size, water depth and load capacity. Standard specification rigs are generally 15 or more years old, have a “hook load,” or derrick hoisting capacity, of less than two million pounds, and have drilling equipment operated by mechanical, rather than electronic, means.
Standard specification rigs operate in the same worldwide markets and environments as high specification rigs, subject to their technical capabilities.
Paragon’s drilling fleet consists solely of standard specification rigs and includes 34 jack-ups and eight floaters (five drillships and three semi-submersibles). Paragon’s primary business is contracting its rigs, related equipment and work crews to conduct oil and gas drilling and workover operations for its exploration and production customers on a dayrate basis around the world.
In February 2014, Randall D. Stilley was selected to serve as President and Chief Executive Officer of Paragon Offshore.