Reliance agrees $320,000 day rate for deepwater rig

Vol 9, PW 12 (22 Sep 05) Exploration & Production

Reliance has agreed to pay a basic day rate of $320,000 for Transocean deepwater drillship Deepwater Frontier.

On 15th September, Transocean announced that Deepwater Frontier would begin its contract in India from October 2006 until September 2008. Discoverer Frontier is presently under contract with Petrobras of Brazil at a day rate of $145,000.

Reliance managed to get a very good price, reveals a source. In todays climate such rigs are going for $420,000 per day or more.

Discoverer Frontiers contract with Petrobras ends in September 2006, after which she will spend thirty days in a shipyard for an overhaul before sailing to India. Reliance will most likely take her straight to the east coast, adds a source.

Thats where their best deepwater acreage is. Deepwater Frontier is a 5th generation deepwater rig built in 1999 capable of drilling in water depths of 10,000 feet and wells up to 30,000 feet below the seabed.

Reliance is also believed to be in negotiations with Transocean to hire drillship Deepwater Expedition but so far Transocean has not disclosed any contract between the two companies for the drillship. Reliance would like both drillships to come to India at the same time, we hear.

Deepwater Expedition might come earlier. For now Deepwater Expedition is under contract to Petrobras at a day rate of $135,000 until October this year.

Shell has hired her from January to May next year for work offshore Egypt at $240,000 per day. After Shell, she will move offshore Morocco where Petronas has hired her until July next year at a day rate of $320,000 per day.

Reliance is believed to be negotiating for her arrival in India after July next year and is expected to issue a tender for rig support services for both Deepwater Frontier and Deepwater Expedition within the next few months.