Diamond Offshore orders drillship, sells jack ups

Diamond Offshore Drilling Inc. ordered a $655 million ultradeepwater drillship from Hyundai Heavy Industries Co. Ltd. with delivery scheduled for fourth-quarter 2014.

The Ocean BlackLion drillship will be built using the same design as Diamond Offshore’s three units already on order with Hyundai.

The drillship will feature two, seven-ram blowout preventer (BOP) stacks. The second BOP will be available for use as a spare in case of a well control incident.

Analysts suggest an increasing number of companies will be ordering offshore drilling equipment featuring spare BOPs.

The BlackLion specifications include dynamic-positioning, dual activity capability, a maximum hook-load capacity of 1,250 tons, and operating capability in 12,000 ft of water, although it initially will be outfitted for operation in 10,000 ft.

“We are principally a floater company, and during 2012 we have sold five jack up rigs for a total of $95 million, which is being reinvested in our fleet,” said Larry Dickerson, president and chief executive officer.

Spare BOPs more likely

Diamond Offshore also announced it has placed orders for spare BOPs for its three drillships already on order.

“We view the additional BOP orders as particularly noteworthy and believe other contract drillers could add additional BOPs to ultradeepwater rigs to get in front of forthcoming BOP regulations,” said James C. West, analyst with Barclays Capital Inc.

Speakers told the Offshore Technology Conference in Houston that new government regulations for BOPs are coming this year, West said.

BP PLC raised its global standards during July 2011 in the aftermath of the April 2010 blowout of the deepwater Macondo well and subsequent explosion on Transocean Ltd.’s Deepwater Horizon semisubmersible. BP operated Macondo.

“We expect other operators to follow suit as greater clarity emerges regarding the new rules,” West said.

The Macondo incident resulted in a massive oil spill in the gulf, prompting changes in US government safety regulations and a renewed industry response to offshore spill prevention.

In a May 14 research note, West estimated industry currently has 87 deepwater floaters under construction for which it could add backup BOPs.

“If all rigs under construction added backup BOPs, we estimate this would represent roughly $3 billion in potential BOP sales,” West said.

In addition, the global fleet has 170 deepwater and ultradeepwater floaters.

West said the US Bureau of Ocean Energy Management during April issued 56 total permits for floating rigs in the Gulf of Mexico, up from 47 permits announced during March and compared with 58 permits in February.

There were 13 new well permits issued in April (up from 5 in March) and 30 revised new well permits (up from 23 in March). Of the 58 permits issued in April, 39 permits were for exploratory work and 17 were for development jobs.

Contact Paula Dittrick at paulad@ogjonline.com.

Related Articles

BHI: US oil rig count rises for first time in 30 weeks

07/02/2015 A sudden 12-unit jump in oil-directed rigs during the abbreviated week ended July 2 represented their first rise since Dec. 5, 2014, and helped lif...

BP to settle federal, state Deepwater Horizon claims for $18.7 billion

07/02/2015 BP Exploration & Production Inc. has agreed in principle to settle all federal and state claims arising from the 2010 Deepwater Horizon inciden...

Shell makes FID on Appomattox deepwater development in Gulf of Mexico

07/01/2015 Royal Dutch Shell PLC has taken a final investment decision (FID) on the Appomattox deepwater development, authorizing construction and installatio...

BHP, Woodside move to decommission Stybarrow field

07/01/2015 BHP Billiton Ltd. and Woodside Petroleum Ltd. have started preparations for decommissioning of the Stybarrow group of oil fields in production lice...

Tullow Oil provides production update on Jubilee, other fields

07/01/2015 Tullow Oil PLC reported that gross production for the Jubilee field offshore Ghana averaged 105,000 b/d in this year’s first half, up from 102,000 ...

Statoil to suspend Scarabeo 5 drilling rig

07/01/2015 Due to overcapacity in its rig portfolio, Statoil ASA said it has decided to suspend Saipem’s Scarabeo 5 dynamically position drilling rig after it...

FWS issues Shell letter of authorization on Chukchi Sea lease

07/01/2015 The US Fish & Wildlife Service issued Shell Gulf of Mexico Inc. a letter of authorization (LOA) related to the potential disturbance of polar b...

USGS: Water usage for fracturing varies widely across shale plays

07/01/2015 The volume of water required to hydraulically fracture wells varies widely across the country, according to the first national analysis and map of ...

Forum extends study of subsea integrity


Work by an industry forum called SURF IM Network, which studies oil and gas subsea integrity management, has been extended by 3 years.

White Papers

Definitive Guide to Cybersecurity for the Oil & Gas Industry

In the Oil and Gas industry, there is no single adversary and no single threat to the information tech...

UAS Integration for Infrastructure: More than Just Flying

Oil and gas companies recognize the benefits that the use of drones or unmanned aerial systems (UAS) c...

Solutions to Financial Distress Resulting from a Weak Oil and Gas Price Environment

The oil and gas industry is in the midst of a prolonged worldwide downturn in commodity prices. While ...
Sponsored by

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by
Available Webcasts

Better Data, Better Analytics, Better Decisions

When Tue, Oct 27, 2015

The Oil & Gas industry has large amounts of data stored in multiple systems which are purpose built for certain tasks. However, good decisions require insights based upon the data in all of these systems. These systems in turn do not talk to each other. So the process of analyzing data, gaining insights, and making decisions is a slow one and often a flawed one. Good decisions require accurate analytics and accurate analytics require superior/sustainable data quality and governance. This webinar focuses on:

  • The importance of data quality and governance
  • How technological advances are making data quality and governance sustainable in order to get the accurate analytics to make solid decisions.

Please join us for this webcast sponsored by Seven Lakes Technologies and Noah Consulting.


Operating a Sustainable Oil & Gas Supply Chain in North America

When Tue, Oct 20, 2015

Short lead times and unpredictable conditions in the Oil & Gas industry can create costly challenges in supply chains. By implementing a LEAN culture of continuous improvement you can eliminate waste, increase productivity and gain end-to-end visibility leading to a sustainable and well-oiled supply chain.

Please join us for this webcast sponsored by Ryder System, Inc.


On Demand

Leveraging technology to improve safety & reliability

Tue, Sep 22, 2015

Attend this informative webinar to learn more about how to leverage technology to meet the new OSHA standards and protect your employees from the hazards of arc flash explosions.


The Resilient Oilfield in the Internet of Things World

Tue, Sep 22, 2015

As we hear about the hype surrounding the Internet of Things, the oil and gas industry is questioning what is different than what is already being done. What is new?  Using sensors and connecting devices is nothing new to our mode of business and in many ways the industry exemplifies many principles of an industrial internet of things. How does the Internet of Things impact the oil and gas industry?

Prolific instrumentation and automation digitized the industry and has changed the approach to business models calling for a systems led approach.  Resilient Systems have the ability to adapt to changing circumstances while maintaining their central purpose.  A resilient system, such as Maximo, allows an asset intensive organization to leverage connected devices by merging real-time asset information with other critical asset information and using that information to create a more agile organization.  

Join this webcast, sponsored by IBM, to learn how about Internet of Things capabilities and resilient systems are impacting the landscape of the oil and gas industry.


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!


Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected