Essar dismisses Wildcat mobilisation doubts

Vol 19, PW 14 (24 Mar 16) Exploration & Production

Essar Oilfields Services is denying rumours it faces a cash crunch and might struggle to mobilise semi-submersible Essar Wildcat under an ONGC contract won last month.

Drillers claim Essar is trying to raise between $13m and $15m to prepare the rig for the ONGC contract and is offering to repay the loan from revenues after deploying the rig. "People can say what they like," retorts an Essar source.

"Like any responsible driller we're preparing the rig for the contract and have 180 days to mobilise from the date of award. We're confident it can be done in that time." ONGC issued the LoA to Essar on February 26, hiring Wildcat for three years at an ODR of $104,350.

Wildcat is at the Sembawang yard in Singapore for its obligatory certification of equipment. "We want to ensure all inspections, repairs and certifications are done before the rig begins the contract," adds Essar.

"Otherwise we'll only earn a rig 'down-time' day rate." Industry sources add the company has settled an estimated $3m penalty it owes ONGC for failing to mobilise the same rig on another contract in 2011. "ONGC will deduct that money from our day rate," we hear.

Another company source reports that Essar has begun rehiring the rig's former crew - it laid off half the 100-strong crew after its contract with Indonesia's Star Energy ended in March 2015.