ONGC issues Discovery-I LoI to Jindal

Vol 11, PW 12 (18 Oct 07) News in Brief

Faced with no choice, ONGC issued a Letter of Intent to Jindal Drilling on October 12 accepting its â€کEffective Day Rate’ of $150,950 for jack-up Discovery-I for three years beginning November 5 next year.

In our last issue we reported how ONGC was willing only to pay $144,000 per day, which Jindal refused. Discovery-I is a 300-feet water depth capable rig under construction in Singapore.

“ONGC will now propose the same rate to Aban for (jack-up) Aban-VIII (offered at $161,502),â€‌ says a source. Jindal had offered two rigs (Discovery-I and Noble George McLeod) and Aban had offered Aban-VIII for ONGC’s three-rig tender.

ONGC wanted to pay only $140,000/day for each rig. “Jindal declined to lower its rate of $185,725 for McLeod, as the rig already has a contract in Qatar,â€‌ says a source.

“It can easily get a higher rate when the contract runs out so McLeod is no longer on offer to ONGC.â€‌ With its LoI for Discovery-1 Jindal has now hired out both its â€کnew-build’ rigs to ONGC.

In July, ONGC hired Jindal’s â€کnew-build’ jack-up Virtue-I for five years at $140,000/day.