NDC lets its ‘black dog’ oil rig stay with its keeper

The National Drilling Company has extended a contract for Italian oil company Saipem to operate its 'Perro Negro 2' rig near Abu Dhabi.

Abu Dhabi’s National Drilling Company has extended its contract with Saipem, an Italian oil and gas contractor, for the operation of its Perro Negro 2 rig.

The drilling contract has been extended for 24 months, from January 2015 until January 2017.

NDC is a unit of Abu Dhabi National Oil Company (Adnoc). Saipem is a unit of the Rome-based energy company Eni. The Perro Negro 2 contract forms part of a US$850 million tranche of new work that oil companies worldwide have awarded to Saipem. The Italian company announced the deals yesterday and said $540m of the work was for offshore activity but did not provide a value for the Abu Dhabi job.

Saipem operates Perro Negro 2 – “Black Dog 2”, in Spanish – which is located offshore in Abu Dhabi. The rig was previously operated by Total Abu Al Bukhoosh, a subsidiary of the French energy company Total.

The Perro Negro 2, which can house 116 people, has a 160ft derrick, and has enjoyed a 34-four year career in the oil industry. It was built at the UiE Shipyard in Glasgow, Scotland, in 1980.

Saipem also operates the Perro Negro 3 rig on a contract that is set to expire in the first quarter of 2016.

Saipem has announced new contracts to be fulfilled in Indonesia, West Africa and Latin America. On July 15, it announced the award of $600m of contracts in Brazil for the leasing and upgrading of two floating production storage and offloading vessels.

Saipem’s shares, traded on the Borsa Italiana, were down 2.5 per cent at 1330 GMT.

The company’s share price has gained 19.3 per cent over the course of the year.

Saipem recorded a loss of €344m (Dh1.69 billion) last year against revenues of €12 billion. It issued two profit warnings in 2013 and faced investigations into allegations of bribery at its Algerian operations. The loss was a result of a “a significant deterioration in [Saipem’s] commercial position in Algeria”, the company said.

Yesterday, Saipem trimmed its net profit forecast for the year to be between 280 million euros and 330 million euros ($375-443 million) from a previous range of 280 million and 380 million euros.

Eni’s management is thinking of selling a controlling stake in the drilling company, Reuters reported on Monday.

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