Atwood Oceanics Shares Gain

Atwood Oceanics shares were up more than 2% Tuesday after the company agreed with Daewoo Shipbuilding & Marine Engineering to delay delivery of two newbuild ultra-deepwater drillships by two years to Sept. 2019 and June 2020.

In connection with the delay, Atwood will make a payment of $125 million for the Atwood Archer on or before Dec. 15, as well as a payment of $15 million on the earlier of June 30, 2018 or the delivery date. With respect to the Atwood Admiral, Atwood will make a payment of $10 million on the earlier of Sept. 30, 2017 or the delivery date.

DSME will extend all remaining milestone payments, which include $83.9 million plus fees and interest for the
Atwood Admiral and $165.0 million plus fees and interest for the Atwood Archer, until Dec. 30, 2022.

“The two-year extensions on the delivery dates greatly improve our confidence that we will secure suitable drilling services contracts on both rigs prior to taking delivery. We now have the opportunity to earn revenues on these rigs that will cover some or all of the final payments to the shipyard,” said Atwood CEO Rob Saltiel.

By BDL Contributor