ONGC selects Aban, Sedco and Pride for rig contract

Vol 6, PW 3 (10 Apr 02) Exploration & Production
     

WE LEARN on good authority that ONGC will select rigs from Aban Lloyd, Transocean SedcoForex and Pride International for its ongoing five-rig contract.

Aban bid two rigs: Aban III (formerly Ile d'Amsterdam) and Hit Drill I, at an 'effective day rate' of $47,174. Both rigs are customs-cleared and have quoted the lowest.

They will get a contract each. Sedco bid three rigs: C.

E Thornton, F.G McClintock and J.

T Angel. C.

E. Thornton is out of the race because it has been awarded a contract for a separate two-rig tender for the same period.

F.G McClintock and J.

T Angel were offered at an 'effective day rate' of $56,542 and $50,850 respectively without customs duty. With customs duty the 'effective day rate' is $66,668 and $65,316 respectively.

Pride's two rigs: West Virginia and North Dakota were offered at an 'effective day rate' of $53,517 and $56,497 minus customs duty. Add customs duty and the day rate for Pride's rigs are: $82,449 (West Virginia) and $85,429 (North Dakota).

No doubt Pride regrets that it valued each rig at $100m to customs; other bidders valued rigs at $35m each. "Pride deliberately overvalued their rigs because of the trouble they face with Indian customs with (rig) Pride Pennsylvania (which was undervalued at $18m).

Ensco Maritime (two rigs) and New Find Oil and Gas (one rig) did not put in bids - unable to comply with ONGC's new guidelines. "We could have offered rigs (after customs duty) at between $65,000 and $70,000 but ONGC's new guidelines limit competition." Ten technical bids were submitted but ultimately just six rigs will chase five contracts.

The tender is for a two-year contract and the rigs must drill in 300 feet water depths. Price bids were opened on 2nd April.