New Vantage rig quote extension

Vol 12, PW 15 (18 Dec 08) News in Brief

Houston-based driller Vantage Energy has extended for a second time the validity of its deepwater rig quote to an ONGC tender by four days until December 19, and cut the price.

Vantage is offering the Platinum Explorer deepwater rig that can operate in 7500-feet water depths. The original December 5 deadline was first extended to December 15.

Vantage has also slashed its operating day rate from $685,000 to about $655,000 from an original quote of $730,000. Industry sources believe ONGC is likely to push Vantage for further cuts, citing its previous tender in June for a deepwater rig that can drill in 10,000-feet water depths, awarded to Sevan Marine at a day rate of $524,900.

“Remember that crude oil was around $135/barrel when Sevan Driller-II was hired,â€‌ says a source. “It’s below $50/barrel now.

â€‌ But Vantage could argue that demand for deepwater rigs remains strong, despite low oil prices. “It comes down to which company is more desperate,â€‌ we hear.