Nice rates for ONGC in floater tender for three rigs

Vol 15, PW 4 (25 Aug 11) Exploration & Production

Transocean and India-based Deepwater Drilling have surprised the drilling community in India by quoting rock-bottom rates in an ONGC tender to hire three floaters that can drill in water depths of 1000-feet for three years.

When ONGC opened price bids in Mumbai on August 10, Deepwater emerged lowest bidder offering Noble Drilling-owned Noble Duchess, ‘cold stacked’ offshore Nigeria, at an Effective Day Rate (EDR) of $207,680 - just $835 less than Transocean’s offer of $208,515 for Actinia. Next lowest was Northern Offshore, which offered Energy Driller for re-hire at $219,750/day.

Northern Offshore also offered Energy Searcher at $226,743/day. Still unclear is when ONGC will award the contract but it wants the selected rigs to mobilise offshore India within 180 days of the Letters of Intent (LoIs).

Deepwater’s offer of Noble Duchess is clearly leading the pack but Transocean and Northern Offshore might win contracts too, if they can match the low rate offered by Deepwater. Actinia is currently working for Petronas offshore Singapore while Energy Driller is drilling for ONGC at $265,000/day but concludes her three-year contract in October before moving to Singapore for routine maintenance.

If she wins a contract, she might then return to Indian waters to begin drilling for ONGC. “Deepwater and Transocean have taken a major gamble in this tender by quoting such low rates,” comments an industry source.

“When bids were submitted (May 25), the prevailing rate for this kind of floater was around $230,000/day.” Given this prevailing rate, he adds, all the rigs offered in this tender have been bid at very “attractive” rates.

Delhi-based Jagson Drilling and Shiv Vani also bid but were disqualified on technical grounds and their price bids remained sealed.