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Transocean Inc. (RIG) Announces Multi-Year Contract for Enhanced Enterprise-Class Design Newbuild Drillship

Transocean Inc. (RIG) is the world’s largest offshore drilling contractor and a provider of drilling management services worldwide. The company possesses a fleet of 138 mobile offshore drilling units, plus nine ultra-deepwater newbuild units. The company’s fleet is considered one of the most modern and versatile in the world due to its emphasis on technically demanding segments of the offshore drilling business. Transocean owns or operates a contract drilling fleet of High-Specification Floaters, Midwater Floaters, High-Specification Jackups, Standard Jackups and other assets utilized in the support of offshore drilling activities worldwide.

The company announced recently that one of its subsidiaries has been awarded a five-year drilling contract for another enhanced, Enterprise-class design, new-build drillship. The five-year drilling contract is expected to commence during the fourth quarter of 2010, following shipyard construction, sea trials, mobilization and customer acceptance. The contract commencement date is contingent on vendor performance and other factors.

The term of the drilling contract revenues, which could be generated over the five-year, seven-year and 10 year contract terms, are approximately $1.01B, $1.35B, and $1.85B respectively. Estimated contract revenues represent the maximum amount of revenue that may be earned in the firm contract period, excluding revenues for mobilization, demobilization, and miscellaneous adjustments. At the maximum contract term, the client may further elect to have the operating day rate for the second five years of the contract fluctuate based on crude oil prices.

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