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There are 74 drillships under construction at yards in South, yards to diversify into deepwater rig construction at yards in South Southeast, and Far East Asia, as construction and subsea equipment

Korea, China, and Brazil. The South well the Persian Gulf, Caspian Sea, manufacturing to increase proft

Korean yards have 51 drillship and the Keppel AmFELS yard in margins.

EPIC n contracts, at Daewoo Shipbuilding & Brownsville, Texas. Orders for jack-up rigs capable of

Marine Engineering Co. Ltd. (DSME), operating in water depths of 300 ft or

Market Review

Construction market

Hyundai Heavy Industries (HHI), more are on the rise.

n

Samsung Heavy Industries, and STX In January, the Energy Research Improved risk assessment is expect-

Shipyard, Jinhae. The ships are on Group at GBI Research released a ed to reduce costs and time delays order from 14 drilling contractors: report on the offshore rig construc- for rig construction projects.

Atwood Oceanics (3), Diamond tion market to 2016 and current rig

Acquisitions

Offshore Drilling (4), Dolphin deployment scenario for jackups,

Drilling (1), ENSCO (3), Maersk (4), semisubmersibles, and drillships. The cost of rig manufacturing and

Noble Corp. (4), North Pole Drilling Not surprisingly, the analysts say tightening of credit in world markets (1), Ocean Rig ASA (4), Pacifc that the rig construction market has affected newbuild rig orders and

Drilling Ltd. (4), Queiroz Galvao Oleo is “linked to the demand-supply has led to acquisitions of smaller e Gas SA (1), Rowan (4), Seadrill scenario of offshore rigs worldwide, drilling contractors.

Ltd. (6), Transocean (6), and Vantage which both directly and indirectly At the end of November 2012,

Drilling (2) affects offshore rig day rates, and the Transocean announced that it had

China began taking turnkey drill- availability and deployment of rigs completed its sale of 38 shallow- ship contracts away from the South globally.” water drilling rigs to Shelf Drilling

Korean shipbuilding giants a few The study says that rig designs Holdings, Ltd., for $1.05 billion. years ago. Three drillers currently promoting better safety conformation Shelf Drilling is a newly-formed have ships under construction in and increased operational capabili- company sponsored equally by

China, including Noble (1) at the ties are key to newbuild orders. It Castle Harlan, CHAMP Private

STX yard in Dalian; Reignwood also stresses that rig contractors cur- Equity and Lime Rock Partners.

Group’s subsidiary Opus Offshore (2) rently prefer to acquire rival compa- Transocean president and CEO by China State Shipbuilding Corp. nies as part of their business strategy, Steven Newman said the transac- (CSSC) at the Shanghai Shipyard; an option that has become common- tion “improves Transocean’s long- and Vantage Drilling (1) at the Cosco place over the past years. term competitiveness by effectively

Dalian Shipyard. Among the trends, cited by GBI: repositioning the company as a more n

Two Brazilian shipyards are Demand for semisubmersibles and focused operator of high-specifca- building 23 drillships are under drillships expected to rise as E&P tion drilling equipment.” construction in Brazilian yards.The companies venture into deepwater Seadrill was established in May

Estaleiro Atlântico Sul (EAS) yard in and ultra-deepwater basins. 2005, is domiciled in Bermuda, n

Pernambuco state and the Estaleiro High offshore day rates are pushing and run from Stavanger by John

Jurong Aracruz (EJA) yard in Espirito demand for rig upgrades in the form Fredriksen, Chairman, and Frederk

Santo state. of new changes in blow-out preven- Halvorsen, CEO. Seadrill acquired

There are 20 semisubmersibles ters (BOPs). Odfjell Drilling (July 2005), followed n under construction in South Korea New rig orders are being driven by by Eastern Drilling., then Stavanger- (7), China (6), Brazil (6), and stringent safety regulations, aging of based Smedvig ASA (January 2006),

Singapore (1). Frigstad Offshore has old rigs, harsh-environment rigs, and Scorpion Offshore (2011), and Asia two, and China Offshore Services sustained high oil prices. Offshore Drilling (2011).

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Ltd. (COSL) and North Sea Rigs AS Long-term contracts are expected to Seadrill is selling its 18 rigs in its each have one at the CIMC Raffes be strongly favored by E&P operators tender rig division to SapuraKencana

Shipyard, China. Sevan has two for leasing deepwater and ultra-deep- for $2.9 billion, to close this quar- cylindrical drilling units being built water rigs. ter – but will they receive enough to n at the Cosco Shipyard, China. South Korea is expected to con- fnance a takeover of Pacifc Drilling?

There are 13 drilling tenders under tinue as the market leader in the Houston-based Pacifc Drilling construction in China (10), Lumut, number of newbuild orders for deep- Services Inc. (PACD) has four

Perak, Malaysia (2), and Keppel water rigs. deepwater drillships in service and n

FELS Singapore (1). The Chinese The rig equipment business is four additional drillships under yards building tenders include: expected to beneft from the imposi- construction at Samsung Heavy

Cosco Guangzhou (3), Cosco Nantong tion of stringent regulatory norms Industries: two for delivery in 2013, (3), Dalian (2), and Rongsheng leading to newer, safer equipment their seventh rig for delivery in May

Shipyard (1). designs. 2014, and an eighth rig for delivery n

And there are 84 jackups under New business strategy by ship- in March 2015.

OE | April 2013 oedigital.comoedigital.com 3434 oe_rig market review.indd 34 4/2/13 9:12 AM