Transocean delays Jurong drillship delivery again

Offshore drilling contractor Transocean has delayed the delivery of one of the two ultra-deepwater drillships it has under construction at the Sembcorp Marine’s Jurong Shipyard in Singapore.

Bartolomej Tomić

Transocean ordered the two ultra-deepwater drillships of the Jurong Espadon III design from Jurong back in 2014, for a price of $540 million each. They were initially scheduled for delivery in 2Q 2017 and 1Q 2018.

In June 2015, the drilling contractor and the shipyard agreed to defer the delivery for the second quarter of 2019 and the first quarter of 2020, respectively.

Come April 2016, another delay was agreed with the rigs – still without contracts secured – slated for delivery during the first and third quarter of 2020.

In October 2017, Transocean agreed with Jurong Shipyard to enhance the two drillships by increasing the hook load capacity to three million pounds.

With the upgrade, Transocean further delayed the delivery dates on each rig, with the drillships then expected to be delivered in the second and fourth quarter of 2020.

The company then, on December 31, 2018, scored a hefty contract – Transocean’s largest since 2013 – for one of the two units with Chevron. This rig is expected to begin its contract in the Gulf of Mexico in the fourth quarter of 2021.

It is not clear when precisely the rig is expected to be delivered, as the contract with Chevron calls for significant upgrades on the rig, including two 20,000 pounds per square inch blowout preventers.

As for the second rig under construction at Jurong, JSPL Ultra-Deepwater Drillship TBN 1, the delivery date has been postponed again.

Transocean has previously said that the drillship, which does not have a contract, would be delivered in the second quarter of 2020. However, according to the fleet status report issued last week, the delivery of the TBN1 drillship has now been postponed for the third quarter of 2020.

Offshore Energy Today has reached out to Transocean and Sembcorp Marine, a parent company of Jurong Shipyard, seeking more info on the reasons behind the delay. Neither of the two companies responded.

Worth noting, while the original price for the two drillships at the time of the order in 2014 was $540 million each, Transocean in its annual report earlier this year shared that the final cost for the two units would be ~$1,93 billion ($1,05 billion for the Titan (TBN2), and $885 million for the TBN1 drillship).

Transocean newbuild rig drillship costs as announced in the 2018 annual report
Transocean newbuild rig drillship costs as announced in the 2018 annual report – Source: Transocean

The chart above, released earlier this year, included the Ocean Rig Santorini and Ocean Rig Crete, two ultra-deepwater drillships under construction at Samsung Heavy Industries Co., Ltd. shipyard in South Korea, which Transocean inherited through the acquisition of rival drilling contractor Ocean Rig in 2018.

The drillships were to be delivered in the third quarter of 2019 and the third quarter of 2020. However, Transocean, on September 23, announced it would relinquish its interests in the two drillships and stop making any further payments to Samsung Heavy under construction contracts, adding that the construction contracts are not guaranteed by the Company or any of its affiliates.

According to South Korean news agency Yonhap, Samsung Heavy said it would review Transocean’s drillship order cancellation and announce follow-up measures.