$335m contracts for two offshore drilling rigs to boost MIS profile

New rig-building orders signed with UAE-based oil and gas fabrication specialists, Maritime Industrial Services (MIS), will position the Middle East as an upcoming player in the global offshore rig building market, a company official has said.

The Sharjah-based MIS has signed rig-building contracts worth $335m (Dh1.2 billion) for the design and construction of two offshore jack-up drilling rigs for Mosvold Middle East Jackup (Meju).

With this deal, MIS is now positioned with a mid-2008 confirmed order backlog of $480m, an increase of $110m from the same period last year, excluding the two Orion rigs subsequently deleted from backlog.

The two firm rigs (Hull 106 and Hull 108), will be supplied by MIS on a turnkey basis and will be built at MIS' shipyard in Sharjah.

"We are the pioneers in off-shore rig-building in this region. With more orders coming our way, we believe we will be able to successfully make the region a hub for offshore rig-building," Peter Convery, President and Chief Executive Officer of MIS, told Emirates Business.

The company said it was pleased to receive the order from Mosvold because it sees it as an important one to further cement MIS' position as a major offshore jack-up rig-builder in the Middle East.

The two rigs, Hulls 106 and 108, are a Friede and Goldman Super Mod 2 design with 30,000 foot rated drilling depth and an operating water depth capability of 300 feet and with a capacity for 110 people on each rig.

"We expect the interest in our new-build programme to continue over the next few years and we are continually looking for opportunities to expand our yard facilities by seeking out ideal locations in the UAE," said Jerry Mickel Smith, MIS Managing Director.

Roy Mosvold, Chairman of Meju, said most of the Middle East-based companies would start shifting their attention to the region to address the demand for more rigs in the market.

"The Middle East is the fastest-growing jack-up market and we look forward to further developing our relationship with MIS as together we address the demand for more new rigs. We see this trend being adopted by other Middle East-based companies involved in offshore business in this market," said Mosvold.

MIS made history in December 2007 when it successfully launched the first offshore jack-up drilling rig to be built in the Middle East, the SeaWolf Oritsetimeyin.

Early this year, it officially named another rig, Seawolf Onome, both built at MIS' Sharjah shipyard under a $254m contract for SeaWolf Oilfield Services Limited, a Nigerian drilling company.

They were originally contracted by Norwegian Mosvold Jackup Ltd in 2006.

The first rig will be handed over in August 2008, followed by the delivery of Seawolf Onome in December 2008. Both rigs are a Friede and Goldman Super Mod 2 design with 30,000 foot rated drilling depth and an operating water depth capability of 300 feet (92 metres).

The GCC is investing heavily in a number of offshore oil and gas exploration projects to the tune of $60bn (Dh220bn) in the next three to four years. The new projects are meant to add oil and gas production capacity. This investment in more offshore projects is causing an unprecedented demand for rigs and workboats of all types.

According to Peter Convery, President and Chief Executive Officer of MIS, the region has witnessed an increased demand for production, and MIS, which currently has a 200,000 sq m shipyard in Sharjah and has invested heavily in the local infrastructure, is benefiting from the shortage in capacity in the traditional international shipyards in areas such as Singapore, China and the United States Gulf Coast.

The increased business for MIS in the offshore jack-up drilling rig market has seen the company expand to a 5,000-strong operation in the Middle East.

MIS recently completed its acquisition of Dubai-based 3C Metal International LLC, a firm specialised in engineering services and steel fabrication of oilfield-related equipment and refurbishment, rig-up and modifications of land drilling rigs.

This was in line with MIS' dual strategy for growth both organically and through strategic acquisitions. MIS was established in the UAE in 1979 and was the first GCC company to list on the Oslo Stock Exchange in May 2007.

Follow Emirates 24|7 on Google News.