Discoverer contract extension talks begin

Vol 15, PW 1 (14 Jul 11) Exploration & Production

ONGC has begun formal talks with Transocean to extend the contract for deepwater drillship Discoverer Seven Seas by another six months.

PETROWATCH learns a four-member team from Transocean met officials from the ONGC drilling department at 3:30pm on July 11 at ONGC’s Mumbai office. “Transocean can easily let ONGC hire Discoverer for another six months,” says a driller.

“This rig does not have any other contract lined up.” But, he adds, Transocean is likely to press ONGC to pay it a better rate for Discoverer than the $316,000/day it has been getting since July 2008.

“Transocean will ask for at least $330,000/day,” we are told. “Market rates for similar drillships are around $340,000/day.

” ONGC and Transocean are expected to take another week to negotiate a day rate and other terms. ONGC’s drilling team must then submit the Discoverer extension proposal to the company’s Executive Purchase Committee for approval before any contract is signed.

Discoverer is at present being moved from ONGC’s pre-NELP KG-OS-DW-III block and is on its way to the ONGC-operated NELP-IV block NEC-DWN-2002/2 in the Mahanadi basin, where it might drill up to two exploration wells. Another Transocean deepwater drillship Dhirubhai Deepwater KG-1 (DD-KG1) is drilling exploration well AN-DW-1 at ONGC’s NELP-IV Andaman deepwater block AN-DWN-2002/1.

DD-KG1 will drill this well to 4500 metres TD and has so far drilled to 3725 metres. Elsewhere, Vantage Drilling-owned and operated deepwater rig Platinum Explorer is in the early stages of drilling an exploration well for ONGC at its 9980-sq km NELP-IV deepwater block MN-DWN-2002/1 in the Mahanadi basin.

Explorer is working for ONGC since last December and should take two months to drill its present well to 6400 metres TD.