Offshore dayrates continue to set records. Transocean Inc., Houston, reports that its deepwater drillship, Discoverer Enterprise, has received a three-year contract extension with BP for $519,600 per day starting in December 2007 for operations in the Gulf of Mexico. The contract is expected to generate a total of $569 million in revenues for Transocean. Calyon Securities (USA) Inc. analyst Mark Urness says, "To put this into context, the Discoverer Enterprise's current contract has a rate of about $182,500 per day, and our $13-per-share 2008 peak earnings forecast assumes the rig will earn $475,000 per day. The rig's new contract lowers the number of 2008 operating days available in this subset of eight drillships from 29% to 16%." Urness says the strength in the dayrate environment is a function of a rig shortage that will exist at least through 2008. Separately, Chevron Corp. has signed three contracts with Transocean total about $1.7 billion in value. For more on this, see the April issue of Oil and Gas Investor. For a subscription, call 713-260-6441.
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