Archives

Home   >   Archives   

Rig Lynx Rewind: Ensco buys Rowan for $2.3 Billion, creates massive fleet of 82 offshore rigs

Rig Lynx
  • By Rig Lynx
  • Mar 29, 2021
  • Category : Archives
  • Views : 1081

 

Story originally published on October 8, 2018

Offshore driller Ensco Plc said on Monday it plans to buy smaller rival Rowan Cos Plc in an all-stock deal valued at $2.38 billion, as it looks to expand its fleet and benefit from a partnership with Saudi Aramco.

 

This creates an offshore drilling company with 82 offshore rigs in its fleet. The two drillers have said that the merger will create a driller with the broadest geographic presence of any offshore driller in the market. Rowan CEO will serve as the chief executive of the combined company.

 

Rowan shareholders will receive 2.215 Ensco shares for each Rowan share. Upon closing, Ensco and Rowan shareholders will own approximately 60.5% and 39.5%, respectively, of the outstanding shares of the combined entity. There are no financing conditions for this transaction.

 

Per Ensco's statement, based on the closing price of each company's shares on October 5, 2018, the estimated enterprise value of the combined company is $12.0 billion.

 

Rowan President and Chief Executive Officer Tom Burke, who will serve as President and Chief Executive Officer of the combined company, said, "We are excited to reach an agreement to combine our well-respected organizations, enabling both Rowan and Ensco shareholders to participate in the substantial value creation opportunities of a larger, more technologically-advanced and diverse offshore drilling company."

 

In a statement on Monday, the companies said the combination would bring together both companies complementary businesses, creating a leading offshore driller by fleet size, geographic presence, and customer base, with 82 rigs spanning six continents and collectively serving more than 35 customers, including the largest national oil companies, international majors and independent exploration and production companies.

 

While Burke will be the CEO of the merged company, Ensco's President and CEO Carl Trowell, will serve as Executive Chairman of the combined company.

 

Commenting on the merger, Trowell said the combination of Ensco and Rowan would create an industry leader in offshore drilling across all water depths, with significant advantages to capitalize on future opportunities and better serve our customers.

 

Ensco and Rowan share a common culture built around safety and operational excellence, innovation, technical expertise and customer satisfaction. Through this combination, Ensco shareholders will uniquely benefit from Rowan's strategic joint venture with Saudi Aramco, ARO Drilling, while all stakeholders will share in meaningful cost savings and even greater upside to improving market conditions as the industry recovery continues gaining momentum, he said.

 

The Saudi Aramco partner to the ARO Drilling joint venture has consented to the combination between Rowan and Ensco.

 

The Fleet

 

According to the statement released on Monday, the combined fleet will consist of 28 floating rigs (semi-subs and drillships) and 54 jack-ups. The number includes two drillships and one jack-up rig under construction and does not include rigs which are part of Rowan's ARO joint venture in Saudi Arabia.

 

Within the fleet of 28 floating rigs are 25 ultra-deepwater rigs capable of drilling in water depths of greater than 7,500 feet, with an average age of six years establishing this fleet among the youngest and most capable in the industry.

 

According to Ensco, the combined fleet will also have the second-largest fleet of the highest-specification drillships in the industry, with 11 of these seventh generation ultra-deepwater rigs.

 

As for the jack-ups the 54-rig jack-up fleet will include 38 units that are equipped with “many of the advanced features requested by clients with shallow-water drilling programs, such as increased leg length, expanded cantilever reach and greater hoisting capacity. Among the combined company's jack-up fleet are seven ultra-harsh environment units and nine additional modern harsh environment rigs.

 

The date of the merger announcement comes almost exactly one year after Ensco completed a merger with Atwood Oceanics in October 2017, becoming the largest jack-up operator in the world at the time.

 

Also, the merger deal further consolidates the offshore drilling space. Just a little over a month ago, in September, Ensco's rival, Transocean, announced it would buy Ocean Rig in a transaction valued at $2.7 billion. To remind, earlier in 2018, Transocean also completed the acquisition of the floater specialist Songa Offshore.

 

Below is the breakdown of the current rig fleet sizes by major offshore drillers, as generated by VesselsValues chart tool. Take note that the chart does not currently show the merged fleets of Ensco & Rowan and Transocean & Ocean Rig.

Join our mailing list here


We are #1 on Google and Bing for the "Largest Mobile Energy Network"

Come join our community!

Download the Rig Lynx app here

Comments (0)

Leave Comment


Check out our other stories

Rig Lynx
Mar 31, 2021

  Elton Group will invest approximately $121 million (FCfa 70 billion) as the concessionaire of the gas terminal at the Autonomous Port of Dakar, signifying the company’s growing role in Senegal’s gas-powered energy transition.   The multi-phased project will involve the construction of a gas terminal for the production, storage, regasification and distribution of Liquefied Natural Gas (LNG), featuring a storage capacity of 140,000 m³.   “The objective of the gas terminal will be to provide a logistical solution by providing LNG to the users that are energy producers, industries, cement plants, mining companies, LNG-powered vessels and neighboring countries,” said Abderrahmane Ndiaye, President of Elton.     In addition to strengthening the domestic gas value chain, the project will generate indirect and direct employment through its construction and operation. It will also represent one of the first projects of its kind in the region.    “Indeed, it would be the first port able to accommodate ships using LNG as fuel, which will give it a significant competitive advantage over other ports in the sub-region,” added Ndiaye.   Elton is a Senegalese petroleum distribution company with operations in Senegal and Gambia. Source: Africa Oil and Power   Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here

Rig Lynx
Mar 31, 2021

  PGS has been awarded a high-fidelity 3D exploration program by a supermajor offshore Egypt.   The survey will be acquired using an Extended Long Offset (ELO) configuration with Ramform Tethys towing a wide multi-sensor GeoStreamer spread with an additional source vessel located several kilometers ahead. This will enable efficient recording of offsets up to 16 kilometers critical for imaging deeper complex exploration targets. The source vessel will be towing a specially designed low frequency source.   The innovative ELO survey design combines optimal spatial sampling for better subsurface imaging together with long offset acquisition for accurate velocity model building. ELO is a cost competitive and efficient configuration compared to other solutions for imaging deep targets.   “We are very pleased to be awarded this contract, which secures PGS vessels to operate in Egyptian waters until May 2021, building on an extended campaign for several super majors since July 2020. In a rapidly changing energy market, exploration seismic requires increasingly advanced survey designs, such as the ELO configuration, to generate high quality seismic data in complex geologies.,” says Nathan Oliver, EVP Sales & Services of PGS.   Source: Africa Petroleum   Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here

Rig Lynx
Mar 30, 2021

  Eni CEO Claudio Descalzi, and the President General Manager of the Algerian state company SONATRACH, Toufik Hakkar, met at the Eni headquarters in San Donato Milanese to take stock of common activities and sign various agreements in the exploration and production, research and development, decarbonization and training fields. These agreements mark a further step forward in strengthening the partnership between the two companies.   The first of the agreements signed aims to implement an ambitious program for the relaunch of exploration and development activities in the Berkine basin region and provides for the creation of a gas and crude oil development hub through a synergy with existing MLE-CAFC installations. This agreement is part of the process for the finalization of a new hydrocarbon contract in the basin, under the aegis of the new Algerian oil law which came into force in December 2019.   Claudio Descalzi and Toufik Hakkar also signed a Memorandum of Understanding for the development of the partnership between Eni and Sonatrach in the new technologies sector, with a focus on renewable energy, biofuels and hydrogen. This agreement aims to strengthen the cooperation already in place between the two companies in the technological field and continue the decarbonization path undertaken to support the transition towards a low carbon future.   Eni and Sonatrach also agreed to collaborate in other sectors such as staff training, through the signing of an agreement that provides for cooperation between Eni Corporate University and the Institut Algerien du Petrole for the implementation of training programs in the Upstream and new technologies related to the energy transition fields.   At the end of the meeting, Eni’s CEO thanked the PDG and the members of the Sonatrach delegation for their constant collaboration and relationship: “Today’s agreements represent the commitment made by our companies to strengthen a historic partnership, in compliance with a shared strategy to accelerate the development of decarbonization projects as part of our commitment of achieving our carbon neutrality goal.”   Eni has been present in Algeria since 1981 where is operator in 48 mining permits. With an equity production of 90,000 barrels of oil equivalent per day, Eni is the main international company operating in the country.   Source: Africa Petroleum   Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here