Ocean Rig sails to higher profits

Reason to smile: Ocean Rig chief executive George Economou saw his company's profits rise in the second quarter

Athens-based drilling contractor Ocean Rig saw second quarter profits jump on the back of increased revenues.

The company's net income for the second quarter of the year totalled nearly $69.6 million, up from just under $38.8 million during the second quarter of 2013.

This came as the company generated $441.4 million from drilling contracts over the three months to 30 June, well up on the $259.8 million in revenue booked over the same period last year.

During the second quarter, the company's fleet operated at 96.3% utilisation which was in line with its operating performance in 2013.

Despite the positive second quarter earnings, Ocean Rig chief executive George Economou warned the company continued to see some softness in the market as several units were set to come off contract and certain uncontracted newbuilds were being delivered.

“As a result, we have seen the first signs of attrition of older units which are coming off contract and in some cases swapped out of existing contracts and replaced by newer units,” he said.

“As the forward contract coverage for older units is in steep decline, we believe that stacking of obsolete drilling assets will increase considerably in the coming months. We remain confident that the underlying demand for drilling in the deep-water areas will result in a strong market for premium drilling assets.”

During the recent quarter Ocean Rig confirmed it had secured a contract for the deep-water drillship Ocean Rig Skyros which will see it continue to work for French company Total in Angola until 2021.

It also signed a minimum six-well contract for the semi-submersible Eirik Raude with Premier Oil for the UK company's exploration campaign off the Falkland Islands.

Economou said the addition of the Premier contract meant the company was in “a very comfortable position” with 100% and 72% of its calendar days under contract in 2014 and 2015 respectively.

Newsletter signup


Become an Upstream member!

Membership includes a subscription to our weekly newspaper providing in-depth news from the energy industry, plus full-access to this site and its archives. Still not convinced? Try our free trial.

Already a member?