Paula Dittrick
OGJ Online
HOUSTON, May 4 -- The deepwater rig market is emerging as a spot market because producers are becoming comfortable with the idea of subletting rig time to other operators, said Oscar Hernández, an analyst for ODS-Petrodata Group.
"Subletting has grown from comprising 2-4% of the US Gulf of Mexico activity in 1996-97 to 15% or more of the market," Hernández told OGJ Online during the Offshore Technology Conference.
Oil and gas companies built a backlog of deepwater leases to explore during 1996-98, and they have committed to long-term contracts on deepwater rigs. Producers are willing to sublet their time on deepwater rigs when they are not using the rigs yet or when less capable rigs can fulfill their requirements.
"Operators are able to get rigs, and they are growing increasingly comfortable that they can get a rig on the spot market," Hernández said. He defined deep water as 2,000-5,000 ft.
EEX Corp. of Houston sublet the Glomar Arctic 1 deepwater rig to Anadarko Petroleum Corp. of Houston. EEX had contracted the rig at $131,000/day but sublet it for $55,000/day, Hernández said.
Meanwhile, Shell Exploration & Production Co. sublet the Noble Jim Thompson, an ultradeepwater rig, to BP PLC. The contract was for $170,000/day and the sublet was for $159,000/day, Hernández said.
"It varies from operator to operator how much of a discount they are willing to take," Hernández said of the sublet rates.
ODS-Petrodata Group is among the companies owned by OneOffshore Inc., Houston, which was formed in July 2000 with the merger of Offshore Data Services, Houston, and Petrodata Ltd. of Aberdeen, Scotland.
Another OneOffshore company, RigInsight, seeks to facilitate a secondary market of contracted rig time between oil companies. RigInsight is a web-based platform slated to launch in mid to late June.
"With guidance from key industry participants, we are creating a robust and powerful platform, targeted specifically at the business needs of the offshore drilling rig market," said Steven Carter, OneOffshore codirector for RigInsight.
RigInsight will provide oil companies and drilling contractors with real-time access to offshore drilling rig market knowledge and tools to improve decision-making, fleet management, and collaborative contracting processes.
"The combination of our proprietary market knowledge and business-oriented tools will enable our clients to realize greater efficiency and utilization of their owned or contracted rig fleets," Carter said.
Contact Paula Dittrick at [email protected]