Power Hedge submits:
On April 8, 2011, SeaDrill Ltd (SDRL) entered into a five-year contract with Pemex. This five year contract calls for the brand-new West Pegasus ultra-deepwater rig to begin operations in Mexico in the third quarter of 2011. The contract calls for a fixed dayrate for the first two years of operations, then annually adjusted to the market rate for the remaining three terms of the contract. You can read the official announcement from SeaDrill about this contract on their webpage.
The contract value is 0 million, assuming a constant dayrate throughout all five years of the contract. That works out to a dayrate of approximately 5,750. That is roughly comparable to the dayrates of SeaDrill’s already existing rigs of the same type. If the market rate is higher than this after the first two years then the dayrate will increase accordingly.
As my previous fleet analysis shows, ultra-deepwater drilling rigs
