Scorpion orders newbuild deepwater semisubmersible

Scorpion Offshore Ltd. has signed a contract with Keppel FELS Ltd. to construct a deepwater semisubmersible at Keppel's shipyard in Singapore.

Offshore staff

HAMILTON, Bermuda -- Scorpion Offshore Ltd. has signed a contract with Keppel FELS Ltd. to construct a deepwater semisubmersible at Keppel's shipyard in Singapore. Construction is expected to span 42 months with delivery in 4Q 2011 at cost of $700 million, including owner furnished equipment, commissioning, project management and financing costs.

This rig will be a dynamically-positioned, four column semisubmersible capable of drilling wells to 8,500 m (27,887 ft) in 2,400 m (7,874 ft) of water.

The rig was ordered pursuant to a letter of commitment from Petrobras for operations beginning prior to June 2012. The commitment has a duration of six years with potential revenue of $1.1 billion plus operating cost inflation adjustments throughout the contract term. The cash flow from this contract will result in full payout of the cost of the rig during the initial contract term.

Scorpion's semisubmersible contract is its second contract with Petrobras with theOffshore Defender having begun operations in Brazil in March.

07/07/2008

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