Ensco International (ESV) Subsidiary Announces Drilling Contarct with Chevron Australia (CVX)

August 29, 2008 9:44 AM EDT

Ensco International Incorporated (NYSE: ESV) announced that a subsidiary of the Company has entered into a drilling contract with Chevron Australia PTY., Ltd for the utilization of ENSCO 7500, an ultra-deepwater semisubmersible rig now operating in the Gulf of Mexico. The rig is expected to complete its current contract with Chevron U.S.A. (NYSE: CVX) in September 2008 and then mobilize to west Australia to commence operations under the new contract by the end of the year. The current day rate of $365,000 will apply during the mobilization period.

The operating rate under the new contract is $550,000 per day, and will be subject to adjustment for variances in operating costs. The initial term of the contract, which runs until August 31, 2010, can be extended by Chevron Australia for one or two additional years at the same rate if the option to extend is exercised by September 1, 2009, or at mutually agreed rates if the option is exercised thereafter.[SM]

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