@ kbair; Last decade, a driller called "Ocean Rig" was contracting to build high-spec,
7th generation drillships during the 2013/2014 drilling boom (like everybody else was
back then) so when the 7 year oil industry downturn began in 2015, Ocean Rig, like
Seadrill, ended up significantly over-extended financially. At about the same time,
Transocean was selling off it's jackup and mid-water fleets and anxious, under the
leadership of it's new CEO, Jeremy Thigpen, to remake it's fleet as an ultra-deepwater
and Harsh Environment specialist.
So Transocean bought Ocean Rig in September of 2018 as part of that effort:
www.sec.gov/Archives/edgar/data/1451505/000145150518000091/c505-20180904ex9912cc652.htm#:~:text=(%E2%80%9COcean%20Rig%E2%80%9D)%20(,of%20Ocean%20Rig's%20net%20debt.
I believe the 3 drillships that you mentioned in your post above were ships that were
acquired in that merger. Importantly, Ocean Rig's objective when it started building
it's drillships was to assemble the best ships in the business at the time, so getting
those ships for that price was exactly what Thigpen wanted to achieve. Transocean's
leadership in 7th generation drillships with 1,400 ST hoist capability had as much to
do with the Ocean Rig acquisition as anything else that they did over the past decade.
What is less understood by many folks, however, is that Transocean's purchase of
Ocean Rig (for the drillships) and Frederick Mohn's "Songa Offshore" (for the cat-d
HE semis) were pretty much responsible for Transocean surviving the covid crash without
going bankrupt. Thigpen was not just buying the state of the art floaters in those
transactions, he was also buying those rigs' very long term contracts, which were written
in 2013/2014 before construction of those rigs began, during the previous oil boom.
The high dayrates on the Ocean Rig and Songa rigs, late last decade and into the first
years of this decade, were the reason, more than anything else, why Transocean survived
the crash without bankruptcy and few people credit Mr. Thigpen for adopting that strategy.
The contracts on the Songa rigs expired before the ones on the Ocean Rig drillships (which
are still ongoing) and the first 2 to expire, on the Endurance and Equinox cat-d rigs,
have since been the ones re-contracted down in Australia. I don't know about "escalation"
clauses on the Ocean Rig units, beyond the expirations shown in the FSR, but as some of the
best drillships in the business, today's industry dayrates on rigs that capable should at
least equal or exceed the rates on their current, long-term contracts so there should be
no drop-off in their earning power in the years to come.
