Rowan Cos. Inc. obviously sees significant possibilities on the Gulf of Mexico Shelf: its directors have approved construction of three more Tarzan-class jackup units. The rigs are to be ready in two years. The Scooter Yeargain, the first such unit the Houston-based driller ordered a year ago, is to go into service in mid-2004. Speculative new construction of rigs generally has been anathema to drilling contractors since the mid-1980s. Rowan is initiating the Tarzan-rig development in anticipation of deeper drilling on the Gulf Shelf since the Minerals Management Service implemented deep gas royalty incentives. Tarzan rigs aren't an everyday jackup, Rowan officials emphasize. They drill more efficiently beyond 15,000 feet in water up to 250 feet deep. Of the more than 50,000 wells that have been drilled in this water depth so far in the Gulf, less than 10% have gone deeper than 15,000 feet. The Tarzan jackups have been used increasingly during the last several months in such shallow-water, deep-gas wells. "The design essentially is completed, and fabrication of numerous components is under way," says Rowan chairman and chief executive officer Robert Palmer. Each rig will cost approximately $10 million. "Rowan is a niche player, and the Tarzan-class rig represents our newest niche." Robert E. Ford, who follows oil-service companies for Sanders Morris Harris in Houston, says Rowan's Tarzan rigs will offer drilling capabilities similar to its Gorilla rigs, but without the Gorilla's water-depth or harsh-environment characteristics. Rowan's four new Tarzan jackups could find work quickly because deep-Shelf drilling is gaining momentum quicker and more intensely than anticipated, he adds. "While gas prices have declined recently, the impact on horizon drilling on the Gulf Shelf is likely to be minimal," he says. "Recent discoveries have been in the 75- to 100-billion-cubic-foot range, significantly greater than those found at shallower depths. The large size of these discoveries makes them more economical at lower natural gas prices than smaller discoveries. As a result, everyone-from independents to supermajors-is starting to get involved." Ford estimates there are 20 jackups capable of efficient deep-Shelf drilling, but adds that upgrades already under way by Diamond Offshore Drilling Inc., Ensco International Inc. and GlobalSantaFe Inc. will add four more units to the fleet. GlobalSantaFe also may bring one or both of its speculative newbuild jackups into the Gulf, he adds.
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