William Furlow
Houston
HAM Marine adds $30 million shipyard and towable dry dock
HAM Marine of Pascagoula, Miss. is gearing up to take advantage of the current rig conversion boom in the Gulf of Mexico. HAM has leased a dual carrier from Rotterdam-based Workships Contractors for operation in the Gulf. The vessel has heavy-lift capacity and 30,000-ton load bearing capability. The vessel is currently enroute from the North Sea to the Gulf of Mexico and should arrive by the end of February. J.L. Halloway, chairman and CEO of HAM said the vessel will be used for a variety of upcoming rig conversion projects including the conversion of the Bill Shoemake later this month.In addition to the portable drydock, HAM has signed a lease with Jackson County Port Authority for the D Dock space adjacent to their current facility. This addition will expand the company's shipyard capacity by 33% and add 500 employees. The D Dock terminal includes two buildings covering a combined 160,000 sq ft. Halloway said his company needs the space and additional employees to meet the increased demand for rig conversion and construction.
The company also will invest $26 million in a joint effort with the port authority, Jackson County Board of Supervisors, and the Mississippi State Department of Economic and Community Development to lease 105 acres of land on Greenwood Island, Miss. where HAM will build a state-of-the-art shipyard dedicated to rig upgrades and conversions.
The new facility will begin construction during the first quarter of this year. Halloway said the first phase of the new shipyard would be up and running by the end of this summer. While the company is already using the new D Dock facilities for current projects, Halloway said the new shipyard will be used for upcoming projects that have not yet been announced. Under the agreement the county, backed by the state, will contribute an additional $6 million to the project.
Halloway said there has been some interest from Wall Street about taking HAM public. Halloway, who owns 81% of the company, declined to give details, but did say an initial public offering is a possibility.
Score report supports rising E&P prediction
Continued growth in demand will soon outpace hydrocarbon reserves clearing the last barrier to rapid growth in Offshore E&P, said Russell Luigs, chairman and CEO of Global Marine, drilling contractor and publisher of the Summary of Current Offshore Rig Economics.
Luigs said the December SCORE is up 28.8% from a year ago and reflects dayrates that are 60.5% of the amount needed to justify new builds. Luigs said his company is confident the SCORE report will eventually surpass the 100% mark, driving up day rates as shipyards struggle to keep pace with steadily increasing demand.
At the heart of this growth is increased global demand for oil. Luigs said demand worldwide is up from 60 million b/d in 1985 to more than 70 million b/d in 1996. "We're going to be looking at another 20 million b/d before you know it. It (demand) has blown through what is available and continues to accelerate," Luigs said.
Traditionally, 60% of this increase in demand has been accommodated through reserves, with new drilling providing 40% of the needed fuel. This use of reserves has driven the excess down from a high of 37% in 1983 to a current level of 4%, according to industry analyst Matt Simmons. "The service industry is going to be required to do a whole lot more than we have in the last few years," Luigs said.
Rig demand mirrors the growing need for new oil. Luigs said. According to Petrodata, all offshore basins are either holding all available rigs in the area or increasing their number. Luigs said this trend will lead to a doubling of rig demand within four years. Of the 65 rigs reported to be idle worldwide, Luigs said only nine are actually ready stacked, the others are either being upgraded, repaired, or are otherwise out of service. "For any practical purpose we are at 98% utilization," Luigs said.
While Global is not contracting any new builds, Luigs said the company is investing $400 million in upgrading its current rigs to operate in deeper water. The only limitations mentioned by Luigs were the supply of qualified employees to work on up grading rigs and the lack of sufficient shipyard space to drydock these rigs.
Air quality study proposed off Louisiana
Industry and government are following an air-quality study proposed in the Breton Wildlife Refuge/Wilderness Area, offshore Louisiana. Some feel this is a potentially precedent-setting event for Clean Air Act implementation. The purpose of the proposed Breton Air Quality Study is to determine if current air emission sources on land and offshore are impairing air quality in BNWA. The proposed study would examine air emissions within a 100 km, radius of the Breton National Wilderness Area in the Gulf of Mexico, with emission-monitoring equipment as part of an air-quality study according to the MMS. Breton is designated as a Class I Area under the US Clean Air Act. According to Chris Onyes, regional director of the MMS, this is the most stringent classification the act provides.
In preparation for the study, the MMS ordered 64 oil and gas operators to collect information about air pollutant emissions. Onyes said the goal is to gather enough information to construct an air quality model that takes into account the fact that most of this area is over water while existing models are based on onshore data. "We're not signaling there will be a change in regulations from this study," he said.
Noble Drilling lands Shell deepwater contract
Noble Drilling has entered into a letter of intent with Shell Deepwater Development for a Noble Drilling EVA-4000 semisubmersible rig. The rig would be Noble Drilling's initial conversion project since the company's announcement that it conducted engineering feasibility studies on converting a submersible drilling unit into a deepwater semisubmersible drilling unit.
The conversion, which the company calls EVA-4000, will create a rig capable of performing drilling operations in water depths of up to 6,000 ft. The initial term of the drilling contract is four years, with an option for SDDI to extend it for a fifth year at predetermined dayrates. Delivery is scheduled for late in the first quarter of 1998.
Trico Marine acquires eight vessels
Trico Marine Services has agreed to purchase seven supply vessels, between 180 and 185 feet in length, and one utility vessel from Laborde Marine for $36.2 million in cash in two separate transactions. Trico will upgrade one of the supply vessels from 180-220 feet and add to the boat's capacity to carry dry bulk and liquid mud. The first transaction will close next month, the second is scheduled for in the second quarter of 1997. These purchases will bring the total Trico fleet to 73.
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