US driller Rowan to move two rigs from US Gulf to Saudi Arabia

Houston (Platts)--31Aug2006

US contract driller Rowan will move two jack-up rigs from the Gulf of
Mexico to offshore Saudi Arabia for Saudi Aramco on a four-year contract worth
more than $550 million, Rowan said Thursday.

The Houston-based company emphasized the mobilization as key to a larger
plan for greater international diversification away from the Gulf of Mexico.

Rowan's announcement came two days after news of another contract for
drilling offshore in Trinidad, extending the mobilization of its Gorilla
III jack-up there through March 2008.

After moving the two Tarzan-class rigs to Saudi Arabia early next year,
Rowan will have 60% of its offshore fleet working outside the US, said Rowan
CEO Danny McNease.

In a quick report on Rowan Thursday, Credit Suisse analyst Ken Sill
saluted the moves, saying the mobilization "will enhance the company's
geographic mix of assets away from the moribund US Gulf of Mexico jackup
market."

"Importantly, the contracts will meaningfully boost Rowan's contracted
backlog and could support multiple expansions given improved visibility," he
said, adding that the Saudi dayrate of $188,000 exceeded US Gulf rates that
range between $115,000 and $150,000.

And he predicted that the movement of a total of 13 jack-ups from the US
Gulf by February would tighten the market to the benefit of contractors.

Once the Saudi mobilizations occur, Rowan will have nine jack-ups left in
the US Gulf and 12 deployed internationally with eight in the Middle East,
three in the North Sea and one in Trinidad, according to Sill's calculations.

--Gary Taylor, gary_taylor@Platts.com

For more news, request a free trial to Platts Oilgram News at
http://oilgramnews.platts.com or subscribe now at
http://www.platts.com/infostore/product_info.php?cPath=1_29&products_id=29


 

Copyright © 2005 - Platts

Please visit:  www.platts.com

Their coverage of energy matters is extensive!!.