The two companies agreed to end the long-term contract for a total consideration of $20 million, about $5 million of the total amount was a deposit previously provided to Ensco prior to the drilling services contract.
Stone originally contracted ENSCO 8503 in October 2014 for a multi-year campaign in the Gulf of Mexico.
The company also agreed to provide Ensco the opportunity to perform certain drilling services beginning before Dec. 31, 2019, and Stone paid Ensco a $5 million deposit to be used as a credit against future drilling activities initiated before March 31, 2017, subject to extension in certain circumstances.
Stone’s Chairman, President, and CEO David Welch stated: “The termination of the Ensco contract eliminates a long-term obligation, which provides Stone with additional financial flexibility” and thanked the drilling contractor for its “willingness to work with Stone during this difficult period of sustained low commodity prices.”
Share your news with Offshore at email@example.com