HHI inks drillship pair

20 Jan 2011

Noble Corporation recently announced that a subsidiary has signed a contract with Hyundai Heavy Industries (HHI) for the construction of two ultra-deepwater drillships.

This order increases the Swiss-based company’s number of floating drilling units to 26, 14 of which are dynamically positioned. The two newbuildings, to be named at a later date, will be constructed on a fixed price basis at HHI’s shipyard in Ulsan, Korea, with expected deliveries from the shipyard in the second and fourth quarters of 2013, respectively. Operations are expected to commence 90-120 days after delivery following mobilization and acceptance testing.

The delivered cost of the new drillships is expected to be $605 million each, and includes the turnkey construction contract, company furnished equipment, project management and spares, but excludes capitalized interest. The construction contract contains favourable payment terms that incentivise on-time delivery. The contract further includes a fixed price option for up to two additional drillships, which must be declared by early May 2011 for delivery in 2014.

“We believe the fundamentals of the global ultra-deepwater market will continue to be strong in the decade ahead,” said David W. Williams, chairman, president and CEO, Noble Corporation. “These units, capable of meeting the industry’s most stringent operating requirements, further support our continued commitment to increasing the technological and operational capabilities of our fleet. Furthermore, the previously announced Letter of Intent from Shell for one unit reduces the speculative risk and enhances future shareholder value.” The rigs are based on a Hyundai Gusto P10000 hull design and are designed for operations in waters of up to 12,000 feet, although either may be outfitted for less depending on specific contract requirements. The units will have DP-3 station keeping abilities, the ability to handle two complete BOP systems, a heave compensated construction crane to facilitate deployment of subsea production equipment and accommodations for up to 200 personnel, in addition to a number of other operational enhancements beyond the shipyard’s base specifications.”

“Amid the rising oil prices, HHI expects to win more such orders,” said a HHI spokesman Jo Sung-woo, without elaborating further. HHI as well as Daewoo Shipbuilding and Marine Engineering and Samsung Heavy are focusing on gaining orders for value-added drillships. Last month, HHI clinched a separate drillship order from US oil explorer Diamond Offshore Drilling for $520 million.

HHI plans to win $19.8 billion worth of total ship orders this year, an increase of 85 percent from last year, it said in a press release. “HHI will maintain the current business momentum for the full year amid moderate recovery signals seen in the global shipbuilding industry,” said Ok Hyo-won, an analyst at NH Investment.

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