Songa Offshore May be Selling a Modern Ultra-Deepwater Rig to Seadrill, but Why? [UPDATE]

songa eclipse
Songa Eclipse, image courtesy Sembcorp Marine

Seadrill announced today that they have entered into a Heads of Agreement (HoA) with Songa Offshore for the potential purchase of the ultra deepwater semi-submersible rig Songa Eclipse.

The Songa Eclipse is currently on an 18 month contract with Total E&P Angola which comes with an option for three, one-year extensions.  Its 18-month contract expires at the end of 2013.

This is interesting news considering day rates in that part of the world, especially for ultra-deepwater rigs like the Eclipse are at an all-time high.  This should be a cash cow for Songa however, other factors may be at play.

Looking at Songa Offshore’s worldwide fleet, the Songa Eclipse is fairly unique.  7 out of Songa’s 10 rigs are on long-term contracts for Statoil in the Norwegian North Sea, and the four currently under construction at DSME in Korea will be working for Statoil once built.

The Eclipse isn’t one of them.  In fact, this rig is the only one working in the Southern Hemisphere for Songa.

Being geographically flexible is a rather important fact of life in the drilling biz, so on paper, having a lone asset operating off Angola may not be such a big factor however, we’re also hearing though the gCaptain grapevine that this rig is having personnel issues involving the expats and the local Angolans on the rig.

Dealing with personnel issues would likely not be a significant problem off Norway, however the 3300 miles of geographic separation between Songa’s HQ in Cyprus and Angola may in the end be the biggest factor.  We’ve reached out to Songa for comment, but due to the time difference we have not yet received a response.

UPDATE: The discussion on the gCaptain Forum is beginning to clarify the picture a bit… read more HERE: http://gcaptain.com/forum/drilling-talk/10079-songa-sell-udw-rig-seadrill.html#post86318