Vantage Drilling Company announced that it has entered into a joint venture with an affiliate of Skeie Group and other investors for purposes of constructing a new, high specification drillship at STX Offshore & Shipbuilding Co. Ltd.'s yard in South Korea. Through its investment of $31 million in the joint venture entity, Sigma Drilling Ltd., Vantage will initially own approximately 42% of the equity in Sigma.
Sigma is a newly-created entity formed for the purpose of constructing a BT-UDS Dynamical Positioned Ultra Deepwater Drillship. The vessel will be capable of and equipped to operate in 12,000 ft water depth, have 25,000 metric ton variable deck load, outfitted with a dual activity derrick, equipped with two seven-ram blow out preventer units and capable of storing up to twelve subsea X-mas trees. The vessel will feature a cutting-edge drilling package that is at the forefront of drilling technology. Delivery of the Vessel is expected in November 2015.
The initial equity funding by the partners is expected to be sufficient to cover substantially all of the shipyard and other capital expenditures which require payment prior to the completion and delivery of the drillship.
Paul Bragg, Vantage's Chairman and CEO, commented, "We view this high-spec drillship construction project as an excellent opportunity for Vantage to further grow our presence in the expanding ultra-deepwater drilling market, with only a small capital commitment. Our partners have been some of the most innovative and successful in this industry. STX and our major equipment providers have excellent track records and technical expertise. We believe that the construction contract provides exceptional value, attractive terms and the high end of available technology."
In conjunction with the investment, Vantage and Sigma are entering into (1) a Project Management Agreement, whereby Vantage will provide construction oversight of the vessel, (2) a Marketing Agreement, and (3) a Management Agreement, whereby Vantage will manage the future operation of drilling services.