Rowan Provides Fleet Contract Status Update
HOUSTON, June 25, 2014 /PRNewswire/ -- Rowan Companies plc ("Rowan" or the "Company") (NYSE: RDC) announced today that its monthly report of drilling rig status and contract information has been updated as of June 25, 2014. The report titled "Monthly Fleet Status Report" can be found on the Company's website at www.rowancompanies.com.
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Notable events in the current report include:
- Rowan Relentless: Entered into a two-year contract with Freeport-McMoRan Oil & Gas LLC, a subsidiary of Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX), that will add approximately $425 million to Rowan's current contract backlog. The drillship is expected to be delivered at the end of March 2015 and operate in the U.S. Gulf of Mexico starting early third quarter 2015. The Rowan Relentless is the fourth and final drillship in Rowan's current construction program. With the award of this contract, all four of the Company's ultra-deepwater drillships are now under long-term contracts.
- Rowan Renaissance: Commenced operations on April 22, 2014. Rig experienced approximately 17 days off rate time during 2Q 2014 for previously disclosed issues with the subsea systems. This has been corrected and similar issues with the remaining drillships are not anticipated. In addition, expected approximately 24 days off rate time during 2Q/3Q 2014 for previously planned commissioning of late arriving equipment.
- Rowan Viking: Reduced 2Q/3Q 2014 off rate time by 23 days to 107 days for previously schedule inspections and equipment modification. Rig is expected to return to service in mid-August 2014 after entering the shipyard in May 2014.
- Gorilla VI: Increased shipyard off rate time by 31 days during 3Q 2014. Rig is currently expected to return to service at the end of July 2014.
- Gorilla IV: Awarded a one-well contract estimated at 40-45 days with Fieldwood Energy in the Gulf of Mexico which commenced mid-June 2014 at $125,000 per day, below the previous day rate of $180,000. Rig was idle for 19 days during 2Q 2014 prior to commencing operations with its current customer.
- Cecil Provine: Previously scheduled off rate time for repairs and inspections increased by 14 days to 35 days and moved to 2Q 2014 from 3Q 2014.
For the second quarter and full-year of 2014, the Company expects jack-up out-of-service time to be approximately 10% and 7-9%, respectively. No operational downtime is included in projected out-of-service days, but the Company estimates jack-up operational downtime to account for approximately 2.5% of in-service days in current and future quarters. Except for the out-of-service days specified in the Monthly Fleet Status Report for the Rowan Renaissance, the Company does not currently expect any further drillship out-of-service days in 2014, and continues to expect operational downtime to be approximately 5% after a break-in period of approximately six months up to one year when operational downtime could be somewhat higher.
Out-of-service days include days for which no revenues are recognized other than operational downtime and cold-stacked days. The Company may be compensated for certain out-of-service days, such as for shipyard stays or for transit periods preceding a contract. However, recognition of any such compensation received is deferred and recognized over the period of drilling operations. Operational downtime is when a rig is under contract and unable to conduct planned operations due to equipment breakdowns or procedural failures.
Unless otherwise indicated, all day rates on the fleet status include estimated amortization of contract mobilization/modification revenues. However, day rates exclude approximately $20-$30 million of other miscellaneous aggregate annual revenue the Company receives during rig operations. Day rates also exclude rebillable revenues which are equally offset by drilling expenses.
This summary is provided as a courtesy and is not intended to replace a detailed review of the Monthly Fleet Status Report. While the Company has attempted to include items it believes are significant, we encourage you to review the Monthly Fleet Status Report in detail.
Rowan Companies plc is a global provider of international and domestic contract drilling services in the ultra-deepwater and shallow water jack-up market with a fleet of 34 offshore drilling units, including four ultra-deepwater drillships, three of which are currently under construction, and 30 jack-up rigs, 19 of which are rated high-specification. The Company's fleet is located worldwide, including West Africa, the Middle East, the North Sea, Trinidad, Southeast Asia and the Gulf of Mexico. The Company's Class A Ordinary Shares are traded on the New York Stock Exchange under the symbol "RDC." For more information on the Company, please visit www.rowancompanies.com.
Statements herein that are not historical facts are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected business, financial performance and prospects of the Company. These forward-looking statements are based on our current expectations and are subject to certain risks, assumptions, trends and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. Among the factors that could cause actual results to differ materially include oil and natural gas prices, the level of offshore expenditures by energy companies, variations in energy demand, changes in day rates, cancellation by our customers of drilling contracts, letter agreements or letters of intent or the exercise of early termination provisions, risks associated with fixed cost drilling operations, cost overruns or delays on shipyard repair, construction or transportation of drilling units, maintenance and repair costs, costs or delays for conversion or upgrade projects, operating hazards and equipment failure, risks of collision and damage, casualty losses and limitations on insurance coverage, customer credit and risk of customer bankruptcy, conditions in the general economy and energy industry, weather conditions and severe weather in the Company's operating areas, increasing complexity and costs of compliance with environmental and other laws and regulations, changes in tax laws and interpretations by taxing authorities, civil unrest and instability, terrorism and hostilities in our areas of operations that may result in loss or seizure of assets, the outcome of disputes and legal proceedings, effects of the change in our corporate structure, and other risks disclosed in the Company's filings with the U.S. Securities and Exchange Commission. Each forward-looking statement speaks only as of the date hereof, and the Company expressly disclaims any obligation to update or revise any forward-looking statements, except as required by law.
SOURCE Rowan Companies plc
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