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Statoil Contracts Transocean Rigs to Drill Exploration Wells

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Statoil ASASTO recently announced that it, along with its license partners, has decided to use Transocean Ltd.'s RIG semisubmersible rig - Transocean Spitsbergen - on three exploration wells in the U.K. Thereafter, the rig will be used on a six-well production drilling campaign on the Aasta Hansteen license in Norway.

In the U.K., the exploration drilling campaign will be carried out for the Mariner, Jock Scott and Verbier licenses. The campaign is intended to begin this summer.

The contract value for the three fixed wells is estimated to be about $18 million and comprises integrated drilling services like fuel, casing running, ROV, slop treatment and cuttings handling.

Mariner is one of the largest projects currently under development in the UKCS. Recoverable reserves from the initial development are projected at 250 million barrels of oil, excluding near field exploration potential. The topsides modules will be fitted in the Mariner field this summer. The field is expected to come online in 2018.

The drilling campaign on Aasta Hansteen is scheduled to commence toward the end of 2017 or the beginning of 2018. The contract value for six fixed wells is projected to be about $95 million, which includes integrated drilling services such as fuel, casing running, ROV, slop treatment and cuttings handling, as well as mobilization, demobilization and modification costs.

Discovered in 1997, the Aasta Hansteen comprises three separate discoveries - Luva, Haklang and Snefrid South - with an estimated recoverable reserves of 47 billion standard cubic metres (Sm3) of gas. A Spar FPSO platform will be used to develop the gas field as the first on the Norwegian Continental Shelf and the largest in the world. Spar is a floating installation consisting of a vertical cylindrical hull moored to the seabed. The hull and platform deck will be assembled in Stord this year. The platform will be tugged to the Norwegian Sea next year.

There are over 200 offshore positions related to the rig. There is additional staffing connected with service companies, numerous onshore positions, base services and more.

Investor confidence on the Statoil stock is reflected in its price chart. Shares of the company lost 0.3% in the last six months, while the Zacks categorized Oil & Gas - International Integrated industry registered a decline of 0.7% in the same time span.

Currently, Statoil carries a Zacks Rank #2 (Buy). Investors interested in the space can also consider Crescent Point Energy Corp. CPG and Cenovus Energy Inc. CVE . Both these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Crescent Point Energy posted a positive earnings surprise of 244.44% in the preceding quarter. It beat estimates in all the four trailing quarters with an average positive earnings surprise of 127.16%.

Cenovus Energy posted a positive earnings surprise of 583.33% in the preceding quarter. It beat estimates in two of the four trailing quarters with an average positive earnings surprise of 74.89%.

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Crescent Point Energy Corporation (CPG): Free Stock Analysis Report

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Transocean Ltd. (RIG): 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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