Ensco Orders New Rig for $225M - Analyst Blog

A leading supplier of offshore contract drilling services, Ensco plc ( ESV ) has engaged Singapore's Keppel Fels to construct a fourth jackup rig based on its KFELS B Class Bigfoot design.

The rig - ENSCO 110 - will be built under a fixed-price contract of approximately $225 million. The cost includes commissioning, systems integration testing and project management.

ENSCO 110 - scheduled for delivery in early 2015 - will be able to operate in water depths of 400 feet and drill up to a depth of 30,000 feet. It will be equipped with a nominal variable deck load of 7,500 kips as well as a cantilever load of 2,500 kips. The rig will also include a 1.5 million-pound derrick, TDS-8 top drive and 15k Blowout Preventer (BOP).

The rig has been tailored by Ensco to include dual drilling fluid capability and the living quarters have been revamped to 6 one-person and 67 two-person rooms. Currently, Ensco has seven newbuild rigs on order, together with four jack-ups and three ultra-deepwater drillships.

Ensco strongly supports design standardization, which it believes facilitates staff in operating and preserving rigs more competently. This is evident in Ensco-operated rigs Ensco 106, Ensco 107 and Ensco 108, which are based on the KFELS B Class Bigfoot design.

Ensco's constant efforts to upgrade its fleet create additional earnings potential for its shareholders. In view of the growing market for high-specification jackup rigs, the company is advantageously positioned to augment its operations as well as revenues.

Ensco carries a Zacks Rank #3, which is equivalent to a short-term Hold rating. However, there are other energy stocks - Stone Energy Corp ( SGY ), Range Resources Corporation ( RRC ) and NGL Energy Partners LP ( NGL ) - which carry a Zacks Rank #1 (Strong Buy) and are expected to outperform the market over the next few months.

ENSCO PLC (ESV): Free Stock Analysis Report

NGL ENERGY PART (NGL): Free Stock Analysis Report

RANGE RESOURCES (RRC): Free Stock Analysis Report

STONE ENERGY CP (SGY): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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