Northern Drilling to buy Hyundai Heavy’s rig for US$400 mln

SEOUL, Northern Drilling Ltd (NODL), a global drilling contractor, has said it will exercise its option to purchase a semi-submersible rig being built by Hyundai Heavy Industries Co., a major South Korean shipbuilder, for US$400 million.

The Bollsta Dolphin is one of the world's most sophisticated floaters and is capable of operating in harsh environments and in deep waters of up to 10,000 feet, according NODL.

The rig is currently under construction and is expected to be delivered in January 2019, the Bermuda-based company said in a press release.

NODL said it will make a pre-delivery installment of $200 million with the remaining balance due on delivery.

"The market for harsh environment capable rigs continues to show clear signs of improvement and stands out favorably in the drilling industry with higher utilization and better contract economics," NODL said.

The offshore drilling rig was originally built following a $620 million deal with a Norwegian customer in 2012, but the customer terminated the agreement in 2015, citing a delay in delivery.

"The losses from the cancellation of the deal were already reflected in our earnings years ago," a Hyundai Heavy official said. "The latest announcement is more meaningful in the sense that we got rid of a lingering headache."

Source: Yonhap News Agency

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