Transocean - Complete Fleet Status As Of April 21, 2016, And Commentary

| About: Transocean Ltd. (RIG)

Summary

Transocean released its April fleet status on April 21, 2016.

Three new contracts totalling approximately $145 million in backlog. The Semisubmersible got awarded a 3-year contract with ONGC. RIG has 22 cold stacked and 6 idle rigs.

RIG is showing resilience and adaptability. The next few quarters will be harsh, however, with a backlog of over $14 billion, RIG will be a survivor.

The SemiSubmersible Actinia.

This article is an update to my preceding article on Transocean (NYSE:RIG), published on November 6, 2015, regarding the September fleet status.

Complete Fleet Status as of April 21, 2016.

To view the most recent fleet status, click here.

1. Rigs Under Construction.

# RIG K feet Delivery Contract End

Day Rate

K $

Location
Ultra-deepwater Drillships
1 Deepwater Proteus 12/40 Inspection Q2'16-Q2'26 519

[Shell]

TBA

2 Deepwater Pontus 12/40

Q1/18

Q4'17-Q4'27

519

[Shell]

TBA

3 Deepwater Poseidon 12/40

Q2/18

Q1'18-Q1'28

519

[Shell]

TBA

4 Deepwater Conqueror 12/40 Q4/16 Q4'16-Q4'21 599

[Chevron]

US GOM

5 JSPL Ultra-deep Espadon TBN 1 ("2") 12/40 1Q'20 Available - -
6

JSPL Ultra-deep Espadon TBN 2

("2")

12/40 3Q'20 Available - -
High-specification Jackups
1 Transocean Cepheus ("1") 400/35 1Q2018 Available -
2 Transocean Cassiopeia ("1") 400/35 3Q2018 Available -
3

Transocean

Centaurus ("1")

400/35 1Q2019 Available -
4 Transocean Cetus ("1") 400/35 3Q2019 Available -
5

Transocean

Circinus ("1")

400/35 1Q2020 Available -
Click to enlarge

("1") - The first of five newbuild high-specification jackups contracted to Keppel FELS Limited's shipyard in Singapore is expected to be delivered from the shipyard in the first quarter of 2018, and the remaining four jackups will be delivered at approximately six-month intervals thereafter.

On March 8, 2016, Transocean Ltd. announced the following:

Today a mutual agreement with Keppel Offshore & Marine Ltd`s shipyard, Keppel FELS, to defer the delivery and related payments of five high-specification jackups until 2020. The Super B 400 Bigfoot Class jackup drilling rigs are now scheduled to be delivered in two and three month intervals beginning in the first quarter of 2020.

("2") Please read my preceding article here.

2. High-Specification Floaters: Ultra-Deepwater

High-specification Floaters

Ultra-deepwater Rigs

7,500'/12,000'-30,000'/40,000'

Ship or Semi

Contract

End

Current

Day Rate

K $

Operator

Location

Day-off

1

Deepwater Thalassa

2015

Ship

2/26

519

[Shell]

US GoM
2

Deepwater Asgard

2014

Ship

6/17

(6/17-6/18 option)

615

(530)

[Chevron]

US GOM

3

Deepwater Invictus

2014

Ship

5/16

5/16-8/16

8/16-9/16

9/16-7/17

592+48

350+48+bonus?

(350 option)

592+48

[BHP Billiton]

Trinidad

US GOM

4

Discoverer Clear Leader

2009

Ship

Owned by Transocean Partners LLC 49%

10/18

581

[Chevron] US GOM

5

Discoverer Inspiration

2010

Ship

Owned by Transocean Partners LLC 49%

3/20

585

[Chevron] US GOM

6

Dhirubhai DW KG1

2009

Ship 12/17 402

[Petrobras] Brazil

(21d)1Q'16

7

Dhirubhai DW KG2

2010

Ship 5/16-11/16 (Not Disclosed)

TBA

(5d)1Q'16 (7d)2Q'16

8

Discoverer India

2010

Ship

9/16

9/16-1/21

528

508

[Reliance] US GOM

[Reliance] India

9

Petrobras 10000

2009

Ship 8/19 423

[Petrobras] Brazil

10

Deepwater Nautilus

2000

SemiSub 8/17 472

[Shell]

US GOM

(2d)4Q'15

11

Discoverer Luanda

2010

Ship 1/18 487

[BP]

Angola

12

Development Driller III

2009

SemiSub

Owned by Transocean Partners LLC 49%

11/16 422

[BP]

US GOM

Click to enlarge

3. High-Specification Floaters: Deepwater

High-specification floaters: Deepwater (12)

4,500-7,200'/25,000'

Ship or Semi

Contract

End

Current

Day Rate

K $

Location
1

Sedco 706

1976/1994/

2008

Semi

9/16

9/16-10/18

279

273

[Petrobras] Brazil

2

Jack Bates

1997

Semi 5/16 195

[Inpex]

Australia

4

M.G Hulme Jr.

1996

Semi 7/16 163

[TBA]

TBA

Click to enlarge

4. High-Specification Semi-Submersibles: Harsh Environment

High-specification floaters: Harsh environment (7)

1,500'-10,000'/25,000'-30,000'

Contract

End

Current

Day Rate

K $

Location
1

Transocean Leader

Location: North Sea

1997 - SemiSub

4 G

5/18

5/18-5/19

335

305

[Enquest] UKNS

2

Paul B. Loyd,JR

Location: North Sea1990 - SemiSub

4 G

9/16

9/16-3/17

3/17-6/17

(6/17-9/17 Option (446)

(9/17-3/18 Option (454)

(3/18-6/18 Option (460)

442

449

456

-

-

-

-

[BP]

UKNS

(11d)1Q'16

3

Transocean Arctic

Location: North Sea

1986 - SemiSub

7/16

7/16-9/16

9/16-11/16

11/16-7/17

N/D

179

-

176

[Faroe Petro]

[Engie]

[Det Norske]

Norway

6

Henry Goodrich

1985-2007/SemiSub

Cold stacked since 9/15

5/16-5/18

275 (~50K for mobilization)

[Husky Oil]

Canada

(74d)Q1'16 (37d)Q2'16

Click to enlarge

5. Midwater Floaters

Midwater floater: (21)

1,000'-3,600'/25,000'

Ship or Semi

Contract

End

Current

Day Rate

K $

Location
1

Transocean Driller

1991

Semi

Will be terminated on 6/30/16

215 [Petrobras] Brazil
2

Sedco 712

1983

Semi

4/16

4/16-10/16

403

409

[Talisman]

UKNS

3

Transocean Winner

1983

Semi

7/16

495

[Marathon] Norway

4

Sedco 7041993

Semi

5/16

160

[Zennor Petroleum]

UKNS

5

GSF Rig 140

1983

Semi 8/16 158

[Oil India]

India

6

Actinia

1982

Semi 5/16 - 6/19 101

[ONGC]

India

Click to enlarge

6. High-Specification Jackups

High-specification Jackup: (11)

350'/400'-30,000'/35,000'

Year built

Contract

End

Current

Day Rate

K $

Location
1

GSF Constellation I

2003

12/16

85

[Bunduq]

UAE

(19d)Q2'16

2

GSF Constellation II

2004

7/16 170

[Vaalco]

Gabon

3

GSF Galaxy I

2001

6/16

5/16-11/16

11/16-5/17

5/17-5/18 Option

5/18-5/19 Option

217

228

231

-

-

-

[Total]

UKNS

4

Transocean Honor

2012

4/16

194

[Chevron] Angola

5

Transocean Andaman

2013

5/16

5/16-5/17

5/17-5/18 option

150

115

110

[Chevron] Thailand

6

Transocean Siam Driller

2013

3/18

140

[Chevron] Thailand

7

Transocean Ao Thai

2013

10/18 139

[Chevron] Thailand

Click to enlarge

Note: The GSF Constellation II has been terminated by Vaalco on January and termination fee were supposed to be agreed. I wrote an article about it here. However, nothing has been indicated by RIG until now.

7 - Stacked and Idle Rigs

Name Year built

Contract

End

Location
Cold stacked rigs
1 Discoverer Spirit 2000 3/15 Trinidad and Tobago
2 GSF Jack Ryan 2000 3/15 Trinidad and Tobago
3 Deepwater Discovery 2000 3/15 North Atlantic
4 Deepwater Pathfinder 1998 3/15 Trinidad and Tobago
5 GSF C.R Luigs 2000 6/15 Trinidad and Tobago
6 GSF Galaxy III 1999 7/15 Denmark
7 GSF Monarch 1986 7/15 North Atlantic
8 Discoverer Enterprise 1999 9/15 US GOM
9 Sedco Energy 2001 9/15 Canari Islands
10 Sedco Express 2001 9/15 Cameroon
11 Transocean Searcher 1988 9/15 NS
12 Transocean Prospect 1992 9/15 UK
13 GSF Galaxy II 1998 9/15 UK
14 Discoverer Champion 2011 2/16 GoM
15 Discoverer Deep Seas 2001 2/16 GoM
16 Deepwater Frontier 1999 1/15 Riau Archipelago
17 GSF Development Driller II 2005 1/16 North Sea
18 Polar Pioneer 1985 12/15 Canada
19 Transocean Marianas 1979-1998 3/16 South Africa
20 Sedco 711 1982 1/16 North Sea
21 Sedco 714 1997 2/16 North Sea
22 Discoverer Americas 2009 12/1 North Sea
Idle Rigs
1 Transocean Barents 2009 9/15 NS
2 Deepwater Millennium 1999 3/16 Asia
3 Cajun Express 2001 4/16 West Africa
4 Sedco 702 2007 4/16 West Africa
5 GSF Development Driller I 2005 4/16 West Africa
6 Transocean Spitsbergen 2010 4/16 NS
Rig held for sale/recycled.
1 GSF Rig 135 ? 1983/3G 8/15 Nigeria
2 GSF Grand Banks ? 1984 10/15 Canada
3 Deepwater Navigator ? 2000 1/16 Brazil
4 Transocean John Shaw 1982 4/16 NS
Click to enlarge

Fleet Analysis Snapshot

Table 1 - Rig fleet per category (minus recent scrapped rigs or held for sale):

Total UDW

Deepwater

semi-subs

HE Deepwater Semi-subs. Midwaters Jackups
Number of Rigs 61 28 5 7 11 10
Newbuild rigs 11 6 - - -

5

Total 72 34 5 7 11 15
Click to enlarge

Note: GSF Rig 135, Grand Banks, Navigator and John Shaw are not included.

Table 2: Rig status, excluding newbuilds:

Idle/Ready-stacked

/Inspection

/Out of service

Stacked Working Rig Total
HS UltraDeepwaters 4 12 12 28
HS Deepwaters 0 1 4 5
HS Semi-submersibles 0 1 6 7
Midwater floaters 2 3 6 11
HS Jackups 0 3 7 10
Total 6 20 35 61
Click to enlarge

Click to enlarge

Note: Backlog estimated and cannot be totally accurate because I do not have the all elements.

Commentary:

Transocean released its April fleet status on April 21, 2016. Here is a list of changes and new contracts.

1 - Cold stacked, Idle and Held for sale, Rigs count:

  1. 22 Cold stacked rigs.
  2. 6 Idle rigs.
  3. 4 Held for sale rigs.

2 - The report includes the following:

  • The semisubmersible Actinia - Awarded a three year contract offshore India at a dayrate of $101,000 ($111 million estimated contract backlog).
  • Deepwater Invictus - Awarded a two well contract offshore Trinidad at a dayrate of $350,000 ($28 million estimated contract backlog).
  • Dhirubhai Deepwater KG2 - Awarded a six month contract; location and dayrate are not disclosed.
  • The midwater floater Transocean John Shaw is classified as held for sale. The rig will be recycled in an environmentally responsible manner.
  • Estimated 2016 out of service days increased by a net 56 days due primarily to contract preparation.
  • Transocean Marianas and Transocean Americas are now cold stacked.
  • The DW Millenium, Cajun Express, Sedco 702, GSF Development Driller I and the Transocean Spitsbergen are now Idle.
  • The Deepwater Nautilus had a day rate reduction from $531k/d to $472k/d

RIG got finally the news about the ONGC tender, and the Semisubmersible Actinia got awarded a contract until 6/19 for a day rate of $101k/d which is pretty low as expected.

Overall, the company added approximately $145 million (Assuming $150k/d for the Dhirubhai DW KG2), which is quite impressive again. I was not expecting any contract and instead a potential termination.

The market is really tough, and despite a new positive momentum for oil, it will take several quarters before we see some change in tendering activity, and another couple quarters to see an increase in day rate.

However, RIG has approximately $14.1 billion in contract backlog, which is the biggest in the Industry, thereby, the company will be able to survive this tough time.

I rate RIG as a buy on any weakness.

Disclosure: I am/we are long RIG.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.