Mystery of idle oil-drilling ship

Durban - Why has an $800 million million ultra-deepwater oil drilling ship been anchored off the Durban coastline for nearly eight weeks? Is it getting ready to drill for oil and gas off the KwaZulu-Natal coastline – or has it simply joined the ranks of other unemployed oil vessels because of falling crude prices? These are some of the questions raised by the public over the past few weeks following the prolonged sojourn off Durban of the “Deepsea Metro 1”. Launched less than four years ago from the Hyundai Heavy Industries shipyard in South Korea, this state-of-the-art drilling ship has been at anchor near Umhlanga since December 22.

The vessel, which can be hired for a cool $ 685 million a day, recently drilled several exploration wells to depths of more than 4km off the coast of Kenya and Tanzania. It is owned by a joint venture company involving Norway’s Odfjell Drilling and Greek tycoon Theodore Angelopoulous’s Metrostar group. According to the Odfjell Drilling website, the vessel can operate at water depths of up to 3km, with a total drilling depth of almost 12km. Unlike some of the older oil rigs that relied on floating platforms anchored to the sea floor, this vessel is highly mobile, and does not have to be towed to drill sites.

With a crew of more than 200, the vessel has a 64m high derrick, along with powerful thrusters and a computer-controlled dynamic positioning system to keep it stable while it is busy with deepwater drilling operations. In some quarters, its arrival off the Durban coastline just before Christmas sparked fears that it was about to embark on deepwater drilling operations off the KwaZulu-Natal coast.

Late last year, President Jacob Zuma announced that South Africa planned to drill at least 30 deep-water oil and gas exploration wells within the next 10 years as part of “Operation Phakisa”. However, a more likely explanation for the “Deepsea Metro 1”’s prolonged layover in local waters is that it’s out of work, at least for now. Odfjell Drilling communications boss Gisle Johanson has not responded to e-mail queries from reporters, but according to the company’s website the vessel enjoyed a financial utilisation rate of close to 98 percent for the past two years.

But unlike most of the company’s other drilling vessels, the “Deepsea Metro 1” contract sheet for this year is currently blank. The vessel is now listed “on laybye”, with records suggesting her next port of call may be in Poland. However, local shipping sources suggest the owners may simply be too embarrassed to say they don’t have work for her. In its last financial reports, Odfjell said the recent oil price drop had “softened demand for the group’s services”.

It also confirmed that some of the company’s ships were temporarily unemployed and predicted an oversupply of deepwater drilling ships in the near term. Transocean, another large deepwater drilling company also confirmed late last year that there was an oversupply of offshore drilling rigs. The Financial Times reported that several oil companies had been forced to cancel or delay certain drilling projects because of high production costs.

(Source: Iol)