Atwood orders two new jackups, may construct another three

Source: Atwood Oceanics

Atwood Oceanics (NYSE: ATW) has executed turnkey construction agreements with PPL Shipyard PTE LTD to construct two Pacific Class 400 jackup drilling units. 

These new rigs will have a rated water depth of 400 feet, accommodations for 150 personnel and significant offline handling features. The two rigs are scheduled for delivery September 30 and December 31, 2012, respectively. 

The total cost, including project management, drilling and handling tools, spares and capitalized interest, of each high specification rig approximates $190 million. Financing for the construction of these two rigs is expected to be provided from a combination of ongoing cash flows of Atwood and debt, as necessary, from Atwood's current senior credit facilities. The Company will consider whether any additional debt may be necessary in connection with fleet expansion. 

Upon delivery, these rigs will become the twelfth and thirteenth mobile offshore drilling units owned by the Atwood.

Atwood and PTE have also arranged option agreements for up to three additional Pacific Class 400 jackup drilling units, which require commitment by Atwood at various times beginning 90 days after the execution of the subject construction contracts and extend to 15 months after the execution of the subject construction contracts. No determination has been made at this time whether any options will be exercised. 

"We look forward to expanding our high-specification jack-up fleet with these Pacific Class 400 drilling rigs,” said Rob Saltiel, Atwood’s president and CEO. “This jack-up design combines excellent capability, efficiency and flexibility that will allow Atwood to better serve our clients. PPL shipyard has an excellent reputation for quality and responsiveness, and we expect they will be a great partner with us in this strategic endeavor."

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