Transocean Cepheus, Transocean Cassiopeia, Transocean Centaurus, Transocean Cetus and Transocean Circinus are five jack-up drilling rigs to be built by Singapore’s Keppel yard for Transocean, a drilling contractor.

However, in its fleet status report dated February 17, the Swiss-based offshore drilling company said it agreed with Keppel to delay the deliveries.

Transocean has said that the deliveries of five newbuild high-specification jack-ups will be postponed by approximately six months each. The two companies have also agreed to extend the period between deliveries of each rig. The driller ordered the rigs in November 2013.

The first of five newbuild high-specification jack-ups, contracted to Keppel FELS Limited’s shipyard in Singapore, is expected to be delivered from the shipyard in the third quarter of 2016. The remaining four jack-ups are expected to be delivered at approximately six-month intervals. The rigs are designed to operate in 400 feet water depth and drill to 35,000 feet. The original plan stipulated for the first rig to be delivered in the first quarter of 2016.

Transocean did not provide the rationale for the delays, however it is understood that falling oil prices have reduced the short-term demand for offshore drilling rigs, as the majority of oil companies have cut capital expenditure for 2015.

Douglas Westwood, an industry intelligence group, recently said that it is not only a drop in demand that is affecting offshore drillers, pointing to the oversupply of rigs.

“The recent build cycle has resulted in a sharp growth in supply that will need time to be absorbed by expected long-term growth in demand,” DW said in its report.

Even Keppel itself recently warned of challenging times ahead. The rig builder has warned that the fall in oil prices, the expected reduction in global oil and gas upstream spending and the projected oversupply of oil rigs has created a challenging environment.

Also in its fleet update, Transocean, which this week replaced its CEO, said its two drilling rigs, the GSF C.R. Luigs drillship and Transocean Legend semi-submersible are idle.

Source: www.offshoreenergytoday.com

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