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Transocean gets $7.6B deal with Shell for rigs

Posted on September 28, 2012

HOUSTON (AP) — Transocean Ltd. said Friday that Royal Dutch Shell has entered into 10-year contracts worth $7.6 billion for four ships that will be used to drill for oil in deep water.

The estimated revenue backlog doesn’t include costs of putting the ships in service. Transocean said investment for the rigs will be about $3 billion excluding interest.

Transocean said the first of the ships is expected to be delivered in mid-2015 with the others following every six months. They will be built in South Korea by Daewoo Shipbuilding and Marine Engineering Co.

The rigs are designed to operate in up to 12,000 feet of water and drill wells to 40,000 feet.

Transocean CEO Steven L. Newman said the rigs add to the revenue backlog, improve its ultra-deep-water fleet and expand the company’s relationship with a key customer.

Shell Executive Vice President Peter Sharpe said the company was modernizing its rig fleet at “fair market rates.”

In midday trading, shares of Switzerland-based Transocean fell 40 cents to $44.97, while shares of Royal Dutch Shell, headquartered in the Hague, Netherlands, dropped 98 cents to $69.58.

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