Transocean (RIG) Announces Multi-Year Contract

May 6, 2008 10:09 AM EDT

Transocean Inc. (NYSE: RIG) announced that one of its subsidiaries has been awarded a five-year drilling contract for another enhanced Enterprise-class design newbuild drillship. In the past three years, Transocean has announced nine newbuild ultra-deepwater drilling rigs, including five enhanced Enterprise-class drillships.

The five-year drilling contract is expected to commence during the fourth quarter of 2010, following shipyard construction, sea trials, mobilization and customer acceptance. The contract commencement date is contingent on vendor performance and other factors. The term of the drilling contract may be extended to seven or 10 years at the client's election up to one week after mobilization. The estimated contract revenues which could be generated over the five-year, seven-year and 10-year contract terms are approximately $1.01 billion, $1.35 billion, and $1.85 billion (assuming the client elects to keep the operating dayrate fixed for the full 10 years and does not terminate the contract early as described below), respectively. [jt]

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