Seven more offshore drilling rigs for Reliance in India

Vol 10, PW 1 (04 May 06) Exploration & Production

Reliance has contracted seven offshore rigs for an ambitious exploration and development programme.

These rigs are a mixture of jack-ups, semi-submersibles and deepwater drillships. Currently only Transoceans semi-submersible Actinia is drilling for Reliance in Indian waters.

Reliance has already issued Letters of Intent for seven more rigs: Transoceans Discoverer 534 (deepwater drillship); C. Kirk Rhein (semi submersible that can drill in 1000 metres water depth); Deepwater Frontier and Deepwater Expedition (both 5th generation deepwater drillships); Fred Olsens Blackford Dolphin (semi submersible that can drill in 2000 metres water); Premium Drillings Deep Driller 1 (375-feet jack-up); and Energy Equipment Services Neptune (semi submersible that can drill in 300 metres water).

Deepwater Frontier is expected to arrive sometime in June and all the others are expected to be in Indian waters by mid 2007. Reliance wants eight rigs drilling by late 2007 or early 2008, says a source.

Some of these rigs are hired on time-based contracts and some on well-based contracts. The longest contracts are for Deepwater Frontier and Deepwater Expedition.

Both have been hired on two-year contracts with an option to extend by another three years each. The minimum contract is for one year and the minimum well-based contract is to drill just one well.

We are told that negotiations are now going on between Reliance and the rig owners before final contracts are signed. The contracts are a formality, we hear.

Lawyers from both sides are going over the fine print. We understand Reliance will pay between $100,000 and $150,000 per day for the jack-up rigs; between $150,000 and $200,000 per day for the C.

Kirk Rhein; and between $400,000 and $500,000 for the deepwater semi submersibles and drillships. These eight rigs will hep Reliance kick-start an ambitious drilling programme across its blocks.

Over the next two or three years, Reliance wants to drill more than 200 wells, we hear. About 60% of these wells will be drilled in water depths of less than 400 metres and the rest in water depths more than 400 metres.