Ensco Exercises Option for Seventh DP3 Drillship

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June 26, 2012

The ENSCO DS-8, modeled after the Samsung GP12000 hull design.

Ensco plc (NYSE: ESV) said Monday it has exercised one of it’s two options for a DP3 ultra-deepwater drillship, citing rising customer demand and favorable day rates.  The vessel, the ENSCO DS-9, will be the seventh DP3 drillship ordered by the deepwater driller from South Korea’s Samsung Heavy Industries shipyard.

The ENSCO DS-9 will be the second drillship based on the proprietary Samsung GF120000 hull design, featuring retractable thrusters, a unique feature developed by Rolls-Royce where the forward thrusters will retract leading to increased efficiency while in transit and reduced overall maintenance.  In April, Ensco introduced the new feature in the ENSCO DS-8, a drillship of the same design.

“Our decision to order two ultra-deepwater drillships over the past three months is predicated on detailed analysis of several important factors,” says Ensco CEO Dan Rabun. “Customer demand has continued to rise and has become even more broad-based due to new discoveries in emerging basins. The near-term supply of deepwater rigs is limited and we believe supply-demand dynamics will continue to support favorable day rates, which have risen sharply over the past year.”

In addition to retractable thrusters, GF12000 design includes a number of features expected to increase operational efficiency.

The DS-9 will feature enhanced and redundant offline tubular stand building features and a 165-ton active heave compensating construction crane, allowing for the deployment of subsea production equipment without interfering with drilling operations. The rig, which will be initially outfitted for drilling in water depths of up to 10,000 feet, will be equipped with dynamic positioning in compliance with DP3 certification; six-5.5 megawatt thrusters for enhanced station-keeping; expanded drilling fluids capacity; a 15,000-psi subsea well control system with six rams, upgradable to seven rams and/or a second BOP stack; burner boom for well testing; and living quarters for up to 200 personnel.

Like the DS-8, the new rig will be able to operate in water depths of up to 12,000 feet with a total vertical drilling depth of 40,000 feet.  And similar to the 6 drillships before it, the rig will aslo feature enhanced safety and environmental features and advanced drilling and completion functionality, including below-main-deck riser storage, triple fluid systems, offline conditioning capability and enhanced client and third-party facilities.

“Significant interest in our latest-design drillships gives us confidence that customers recognize the technological advantages of our drillships relative to competitors and the benefits we provide from rig standardization,” added Rabun.

Ensco says that it’s three active DP3 drillships are currently contracted into 2016 in the U.S. Gulf of Mexico, Brazil and West Africa. A fourth rig, the ENSCO DS-6, is undergoing pre-commissioning modifications in preparation for its first well assignment under a five-year contract with BP. Meanwhile ENSCO DS-7 and ENSCO DS-8 are scheduled for delivery in the second quarter of 2013 and third quarter of 2014, respectively.

The DS-9 is expected to cost approximately $645 million, including commissioning, systems integration testing, project management and spares.  The rig is expected to be delivered in the fourth quarter of 2014.  Ensco has one remaining option with Samsung for a similar drillship.

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