Cobalt International has agreed to terminate its long-term contract for the Rowan Reliance drillship. The drilling contract was originally due to terminate on 1 February 2018. Instead, it will now end on 31 March 2017.
Cobalt says it will also save 45% of the contract value between the original termination date and the new termination date, or approximately US$80 million, and will pay to Rowan the remainder of approximately $98 million. Cobalt also commits to use Rowan as its exclusive provider of drilling services for five years at market rates as determined by normal indices, Cobalt says.
Timothy J. Cutt, Cobalt’s CEO, said: “We are very glad to reach an agreement with Rowan that helps our balance sheet in the near term and secures a strong relationship with Rowan for the long term.”
The Rowan Reliance is an ultra deepwater drillship of GustoMSC P10,000 design, capable of drilling wells to depths of 40,000ft in up to 12,000ft water depth. It was built by Hyundai Heavy Industries and delivered in 2014.