RIL gets Transocean rig for $935 mn, to form JV

MUMBAI: Reliance Industries (RIL) will hire a ultra-deepwater drillship ‘Deepwater Pacific 1’ from the world’s largest offshore drilling contractor, Transocean, for $935 million. The rig will be owned and operated by a 50:50 JV between a Transocean’s subsidiary and Pacific Drilling. ET reported on October 11 that RIL and ONGC were in the race to hire Transocean ultra-deepwater rigs.

When contacted, RIL spokesperson Paresh Chaudhry said, “RIL has signed a contract with Transocean for contracting the Deepwater Pacific 1. This will be deployed for drilling operations in the east coast of India in the ultra deep waters drilling—up to 12,000 feet. RIL is currently operating seven deep water rigs.”

Drillship Deepwater Pacific 1 will be constructed at Samsung Heavy Industries’ shipyard in South Korea. Transocean JV with Pacific Drilling will own two ultra-deepwater Samsung-design drillships. With Deepwater Pacific 1 being contracted by RIL, Transocean is in discussions with operators for drillship Deepwater Pacific 2, which is expected to be complete by the fourth quarter of 2009.

Guy A Cantwell, the Transocean spokesperson, said “We have exercised an option to purchase 50% interest in a JV company with Pacific Drilling Limited. We have a commitment for the four year drilling contract for the construction of the first JV drillship to be named as Deepwater Pacific 1. This rig will be available from third-quarter of 2009.”

Deepwater Pacific 1 will provide RIL an opportunity to drill deep waters to water depths below 12,000 feet and is outfitted to construct wells up to 35,000 feet deep. The estimated delivered cost for the Deepwater Pacific 1, including customer reimbursed equipment, is approximately $685 million, excluding capitalised interest.

RIL and ONGC were also scouting to contract another Transocean drillship Deepwater Pathfinder, which the company has hired out to another firm. RIL will use the rig for drilling operations in the East Coast, where it discovered significant oil and gas reserves in the last five years.

Given spiralling crude prices, India’s energy firms are lining up big exploration plans but are faced with the problem of non-availability of rigs. RIL and ONGC put together have secured over 90% of Indian deepwater blocks but are finding it difficult to complete their minimum work programme (MWP) in the respective blocks because of non-availability of rigs.