Surprise foreign interest in jack-up tender

Vol 14, PW 2 (15 Jul 10) Exploration & Production

Foreign drillers have taken a sudden interest in a separate ONGC tender to re-hire a jack-up from next January, as a direct result of the BP oil spill.

Earlier it looked like a straightforward fight between Indian companies Jagson Drilling offering Deepsea Matdrill and Aban Offshore offering Aban-II. Both rigs are already working for ONGC.

But PETROWATCH hears Houston-based Hercules Offshore could emerge as a ‘dark horse’ in this race to supply a single ‘mat-supported’ rig to ONGC for three years. Hercules has a fleet of such rigs and wants to increase its India presence because of the blanket ban on offshore drilling in the Gulf of Mexico, following the BP oil spill.

Hercules already has two Offshore Supply Vessels and two jack-ups working for ONGC: Hercules 260 and Hercules 258. According to a reliable source, Hercules has bought tender documents for this ONGC tender, but surprisingly, did not attend the pre-bid in Mumbai on June 16 for this and another tender to hire a ‘floater’ or barge-mounted rig.

Another foreign driller that attended was US-based Pride International, no doubt interested for the same reason as Hercules. Other drillers attending were Jagson, Aban, Great Offshore, Essar Oilfield Services, and Enquest.

One participant tells us the event was a lacklustre affair. “Hardly any questions were asked,” he says.

“Both are ‘low-spec’ rigs.” Jagson and Aban remain frontrunners for the mat-supported tender while Great Offshore’s Badrinath, already working for ONGC, is the favourite to win the ‘floater’ tender.

Still, expect a strong challenge from the surprise new foreign entrants. “Rigs on the market in both categories are about 30 years old and fully depreciated – completely debt-free,” explains an observer.

“Any driller desperate for work can offer them virtually free. All he has to do is bid enough to cover costs with a small margin.

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