Ocean Rig considers cold stack for units off contract

Offshore staff

NICOSIA, Cyprus – Ocean Rig UDW Inc. (NASDAQ:ORIG) has started work offshore Angola with the Olympia, and expects to move the rig to the Ivory Coast for one well in 4Q 2015 before returning to Angola to complete the contract that runs to June 2016. Ocean Rig says the unit will be cold stacked if no work is contracted beyond that.

The Eirik Raude is in the middle of a six-well contract in the Falklands and expects to be there into January 2016. Beyond that, lacking any prospects for use, Ocean Rig has said the unit will be cold stacked and other options examined, including disposal or scrapping.

The same fate awaits the Leiv Eiriksson once it completes its current contract this coming March.

The Skyros has begun a new six-year contract for work offshore Angola, and the Mylos is completing a well off Brazil. Ocean Rig has received a notice from its client of “material breach” of the Mylos contract with the ultimate result of terminating the contract. Ocean Rig has said the “notice is totally without merit and we intend to vigorously defend our rights under the contract.”

“For rigs that we cannot secure long-term employment that are coming up for their five-year SPS we will cold stack the units and in the case of the semisubmersible rigs seriously consider all our options including disposal or scrapping,” said George Economou, chairman and CEO.


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