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Exhibit 99.1

 

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Ensco plc

Fleet Status Report

22 July 2011

 

Monthly Changes

Bolded rig names and underlined text signify changes in rig status from previous report.

Segment /

Region / Rig

  

Design

   Water
Depth’ (1)
  

Customer/Status

  

Day Rate
$000’s US

  

Location

  

Est. Avail /
Contract
Change

  

Comments

Deepwater

                    

North & South America (excluding Brazil) - See Definitions and Disclaimers

     

ENSCO DS-3 (3)

   Drillship, DP3 Samsung    10000/12000    BP    High 480s    U.S. Gulf of Mexico    Jun. 16    Full day rate, high 480s, and 5-year term contract began 1 Jun. 11. See footnote 3 regarding change in day rate from prior report

ENSCO DS-5

   Drillship, DP3 Samsung    10000/12000    Petrobras    Mid 430s    U.S. Gulf of Mexico    Jul. 16    Full day rate, mid 430s, and 5-year term contract began 11 Jul. 11. Eligible for bonus opportunity up to 17%, plus costs adjustments. Prior fleet status report included bonus opportunity (approx.$70,000) in the reported day rate

ENSCO 8500

   Semisubmersible DP    8500/10000    Eni/Anadarko    Mid 290s    U.S. Gulf of Mexico    Aug. 13    Lump sum payment of $20 million and one-time reimbursable costs of $27 million amortized over primary contract term, which equals approx. $31,000 per day. Plus cost adjustments and four 1-year same-rate options

ENSCO 8501

   Semisubmersible DP    8500/10000    Nexen/Noble Energy    Mid 370s    U.S. Gulf of Mexico    Jun. 13    Currently allocated to Noble. For Nexen’s allocation of rig time, see U.S. Gulf of Mexico on Definitions and Disclaimers page. Mob and upgrade costs are reimbursed by Noble and Nexen at approx. $19,000 per day over primary contract term. Plus cost adjustments and unpriced options

ENSCO 8502

   Semisubmersible DP    8500/10000    Nexen    High 480s    U.S. Gulf of Mexico    Jun. 13    Full day rate, high 480s, and 2-year term contract began 20 Jun. 11. Plus approx. $35,000 per day for reimbursable mobilization expenses and upgrades amortized over 2-year term contract

ENSCO 8503(2)

   Semisubmersible DP    8500/10000    Tullow/Cobalt    High 430s    French Guiana    Sep. 11    Sublet to Tullow to Sep. 11. Then estimate 25 day demob at 75% of day rate (i.e. mid 320s) and 21 days at special rate of low 210s for upgrades. Then expect to commence original 2-year term contract with Cobalt in U.S. Gulf of Mexico, low 530s, plus reimbursable expenses and upgrades to be amortized over Cobalt’s primary contract term of approx. $54,000 per day once term contract commences

Brazil

                    

ENSCO DS-4(3)

   Drillship, DP3 Samsung    10000/12000    BP    Mid 540s    Brazil    Jul. 16    Full day rate, mid 540s, began 21 May and 5-year term contract began 17 Jul. 2011. See footnote 3 regarding change in day rate from prior report

ENSCO 7500

   Semisubmersible DP    8000    Contracted/mob/sea trials       Brazil    Oct. 11    Next to Petrobras to May 14, low 320s. Eligible for bonus opportunity up to 5%. Plus mob and upgrade costs to be amortized over contract at approx. $20,000 per day

ENSCO 6001

   Semisubmersible - DP Amethyst 2    5000/5600    Petrobras    Mid 270s    Brazil    Jun. 13    Eligible for bonus opportunity up to 15%, plus cost adjustments

ENSCO 6002

   Semisubmersible - DP Amethyst 2    5600    Petrobras    Mid 270s    Brazil    Jul. 13    Eligible for bonus opportunity up to 15%, plus cost adjustments

ENSCO 6003

   Semisubmersible - DP Amethyst 2    5600/5700    Petrobras    High 310s    Brazil    Jan. 17    Estimate 42 days shipyard in 3Q 2011 at zero rate. Eligible for bonus opportunity up to 15%, plus cost adjustments

ENSCO 6004

   Semisubmersible - DP Amethyst 2    5700    Petrobras    High 310s    Brazil    Oct. 16    Eligible for bonus opportunity up to 15%, plus cost adjustments

Europe & Mediterranean

           

ENSCO 5006

   Semisubmersible - Conv Bingo 8,000    6200/7500    Noble Energy    Mid 270s    Israel    Oct. 11    Plus cost adjustments and five 1-well options

Middle East & Africa

           

ENSCO DS-1

   Drillship - DP Gusto 10,000    6000/10000    TOTAL    Mid 190s    Angola    Dec. 14    Rate increases mid Dec. 11, low 350s. Anticipate two months planned downtime at zero rate in 2012. Plus options and cost adjustments. Eligible for bonus opportunity up to 7% to Dec. 11 and thereafter up to 5%

ENSCO DS-2

   Drillship - DP Gusto 10,000    6000/10000    TOTAL    Mid 460s    Angola    Jul. 13    Eligible for bonus opportunity up to 5%, plus cost adjustments

ENSCO 5001

   Semisubmersible - Conv Sonat Offshore/Aker    5000/6500    Shipyard    ----------    Angola    Sep. 11    Next to Maersk in Angola to Mar. 12, mid 270s. Plus one 1-well same price option. Then to PetroSA in South Africa to Mar. 14, mid 270s. Plus two 1-well options, low 320s

 

Page 1 of 6


LOGO   Ensco plc  
  Fleet Status Report  
  22 July 2011  

 

Monthly Changes

Bolded rig names and underlined text signify changes in rig status from previous report.

 

Segment /

Region / Rig

  

Design

   Water
Depth’ (1)
  

Customer/Status

  

Day Rate
$000’s US

  

Location

  

Est. Avail /
Contract
Change

  

Comments

Deepwater

                    

Asia & Pacific Rim

  

ENSCO 8504

   Semisubmersible DP    8500/10000    Under construction/ contracted/sea trails       Singapore/ Brunei    3Q11    Next to TOTAL to Mar. 12, mid 420s. Plus options. Mob and upgrade costs to be amortized over contract at approx. $94,000 per day. For details see 21 April 2011 press release

Under Construction - uncontracted

     

ENSCO DS-6

   Drillship, DP3 Samsung    10000/12000    Under construction       South Korea    4Q11   

ENSCO DS-7

   Drillship, DP3 Samsung    10000/12000    Under construction       South Korea    2H13   

ENSCO 8505

   Semisubmersible DP    8500/10000    Under construction       Singapore    1H12   

ENSCO 8506

   Semisubmersible DP    8500/10000    Under construction       Singapore    2H12   

 

(1) 

For rigs that may be modified to drill in deeper water depths, both the currently outfitted and maximum upgrade capabilities are shown.

(2) 

While ENSCO 8503 has earned a sublet day rate since its successful completion of acceptance testing, the original two-year contract has not yet commenced. Therefore, mobilization from the shipyard and other related reimbursements are not yet being recognized in revenue.

(3) 

On 31 May 2011, Ensco completed the acquisition of Pride International. On Pride’s previous fleet status reports, day rates reported for two rigs, ENSCO DS-3 (Deep Ocean Ascension) and ENSCO DS-4 (Deep Ocean Clarion), included reimbursable items related to mobilizations and capital enhancements that were being invoiced monthly. Non-recurring reimbursable items related to mobilizations and capital enhancements for all other Pride rigs were excluded from the reported day rates on Pride’s fleet status reports.

Ensco excludes non-recurring reimbursable items related to mobilizations and capital enhancements from its day rate definition regardless of how these amounts are invoiced or paid.

Separately, under the acquisition method of accounting in accordance with U.S. GAAP, revenues recognized for the ENSCO DS-3 and ENSCO DS-4 contracts subsequent to the acquisition will not include reimbursements received for mobilizations, capital upgrades or other services performed by Pride prior to the acquisition. Therefore, the reported day rate for ENSCO DS-3 was reduced from low 540s to high 480’s and the reported day rate for ENSCO DS-4 was reduced from high 590s to mid 540s to exclude these items.

Importantly, the amount of expected cash flows for these contracts remain unchanged.

 

Page 2 of 6


LOGO   Ensco plc  
  Fleet Status Report  
  22 July 2011  

 

Segment /

Region / Rig

  

Design

   Water
Depth’ (1)
  

Customer/Status

  

Day Rate
$000’s US

  

Location

  

Est. Avail /
Contract
Change

  

Comments

Midwater

                    

Brazil

                    

ENSCO 5000

   Semisubmersible - Conv Neptune Pentagon    2300/2650    Petrobras    Low 240s    Brazil    Jul. 13    Eligible for bonus opportunity up to 15%, plus cost adjustments

ENSCO 5002

   Semisubmersible - Conv Aker H-3    1000    OGX    Mid 330s    Brazil    Nov. 11    While the ENSCO 5004 and ENSCO 5002 are working concurrently, their rates are adjusted to mid 260s each

ENSCO 5004

   Semisubmersible - Conv F & G Enhanced Pacesetter    1500    OGX    Mid 190s    Brazil    Sep. 11    While the ENSCO 5004 and ENSCO 5002 are working concurrently, their rates are adjusted to mid 260s each

ENSCO 5005

   Semisubmersible - Conv F & G Enhanced Pacesetter    1500/1700    Petrobras    Mid 230s    Brazil    Apr. 13    Eligible for bonus opportunity up to 10%, plus cost adjustments

ENSCO 6000

   Semisubmersible - DP Amethyst    3400/4000    Petrobras    Low 150s    Brazil    Feb. 12    Currently outfitted for workover activity. Eligible for bonus opportunity up to 18%, plus cost adjustments

Middle East & Africa

           

ENSCO 5003

   Semisubmersible - Conv Aker H-3    1000    Shipyard    ----------    South Africa    Sep. 11    Next to SOCO in Congo to Dec. 11, mid 180s. Plus one 1-well same rate option

Other

                    

Deepwater Drilling Management

        

Kizomba

   Deepwater TLP Drilling Rig    5000    ExxonMobil    Mid 70s    Angola    Apr. 15    Management fee paid daily

Thunder Horse

   Deepwater Semisubmersible    6000    BP    Mid 80s    U.S. Gulf of Mexico    Jan. 12    Management fee paid daily

Barge Rig

                 

ENSCO I

   Barge Rig       Cold stacked       Singapore      

 

Page 3 of 6


LOGO   Ensco plc  
  Fleet Status Report  
  22 July 2011  

 

Segment /

Region / Rig

  

Design

   Water
Depth’
  

Customer/ Status

   Day Rate
$000’s US
  

Location

  

Est. Avail /
Contract
Change

  

Comments

Jackups

                    

North & South America (excluding Brazil)

U.S. Gulf of Mexico - See Definitions and Disclaimers

ENSCO 59

   F&G    300    Cold stacked       Gulf of Mexico      

ENSCO 68

   MLT 84-CE    400    Chevron    Low 100s    Gulf of Mexico    Jan. 12    Day rate does not include certain extra reimbursable costs

ENSCO 69

   MLT 84-Slot    300    Cold stacked       Gulf of Mexico      

ENSCO 75

   MLT Super 116-C    400    Apache    Low 100s    Gulf of Mexico    Oct. 11   

ENSCO 81

   MLT 116-C    350    Walter    Low 80s    Gulf of Mexico    Aug. 11   

ENSCO 82

   MLT 116-C    300    Chevron    High 70s    Gulf of Mexico    Jan. 12    Day rate does not include certain extra reimbursable costs

ENSCO 86

   MLT 82 SD-C    250    Apache    Low 60s    Gulf of Mexico    Sep. 11   

ENSCO 87

   MLT 116-C    350    Apache    Low 80s    Gulf of Mexico    Oct. 11   

ENSCO 90

   MLT 82 SD-C    250    Arena Energy    High 50s    Gulf of Mexico    Nov. 11    -------------------------------

ENSCO 99

   MLT 82 SD-C    250    W&T Offshore    Low 60s    Gulf of Mexico    Aug. 11   

Pride Wisconsin

   MLT-Slot    300    Cold stacked       Gulf of Mexico      

Mexico

              

ENSCO 83

   MLT 82 SD-C    250    Pemex    Low 110s    Mexico    Nov. 12    Plus cost adjustments

ENSCO 89

   MLT 82 SD-C    250    Pemex    Mid 70s    Mexico    Mar. 12    Rates adjust to global index rate every 3 months (next Aug. 11)

ENSCO 93

   MLT 82 SD-C    250    Pemex    High 80s    Mexico    Mar. 12    Rates adjust to global index rate every 3 months (next Oct. 11)

ENSCO 98

   MLT 82 SD-C    250    Pemex    Low 110s    Mexico    Apr. 12    Plus cost adjustments

Europe & Mediterranean

North Sea

                    

ENSCO 70

   Hitachi K1032N    250    PA Resources    High 80s    Denmark    Aug. 11    Next to Tullow to Dec. 11, low 90s. Then to RWE Dea to Oct. 12, high 80s, Plus five 1-well options at mutually agreed rates

ENSCO 71

   Hitachi K1032N    225    Maersk    High 80s    Denmark    Mar. 12    Plus three 1-year options at escalating day rates

ENSCO 72

   Hitachi K1025N    225    Maersk    High 80s    Denmark    Jun. 12    Plus three 1-year options at escalating day rates

ENSCO 80

   MLT 116-CE    225    Tullow    High 80s    UK    Sep.11    Next to Wintershall to Feb. 12, low 90s, plus one 1-well option at mutually agreed rate deferred to after EOG. Then to Dana to Apr. 12, low 100s. Then to Perenco to Jul. 12, mid 90s, plus one 1-well same rate option. Then to EOG to Feb. 13, high 90s, plus one 2-well option at mutually agreed rate

ENSCO 92

   MLT 116-C    225    E.ON    Low 100s    UK    Sep. 11    Next to RWE Dea Oct. 11 to Jun. 12, high 80s. Plus one 3-well option

ENSCO 100

   MLT 150-88-C    350    E.ON    Mid 130s    UK    Mar. 12    Plus one 3-well option at market rate

ENSCO 101

   KFELS MOD V-A    400    Maersk    Low 170s    UK    Mar. 12    One unpriced option plus cost adjustments

ENSCO 102

   KFELS MOD V-A    400    ConocoPhillips    Low 200s    UK    Jun. 16    Rate firm for 8 wells (est. 3 years) thereafter at mutually agreed rate. Plus options at mutually agreed rates

Mediterranean

                    

ENSCO 85

   MLT 116-C    300    PA Resources    Mid 90s    Tunisia    Aug. 11    -------------------------------

 

Page 4 of 6


LOGO   Ensco plc  
  Fleet Status Report  
  22 July 2011  

 

Segment /

Region / Rig

  

Design

   Water
Depth’
  

Customer/ Status

   Day Rate
$000’s US
  

Location

  

Est. Avail /
Contract
Change

  

Comments

Jackups

           

Middle East & Africa

                 

Middle East

  

ENSCO 54

   F&G L-780 Mod II-C    300    ADOC/Bunduq    High 50s    UAE    Feb. 12    Plus cost adjustments and well-to-well options at mutually agreed rate

ENSCO 58

   F&G    250    Saudi Aramco    Mid 60s    KSA    Dec. 13    Plus one year same rate option

ENSCO 76

   MLT Super 116-C    350    Saudi Aramco    Low 100s    Saudi Arabia    Jun. 14    Planned shipyard upgrade, mid Sep. 11 for approx. 30 days at zero rate. Plus one year option, high 150s

ENSCO 84

   MLT 82 SD-C    250    Contracted/shipyard       Bahrain    Oct. 11    Next to Saudi Aramco to Dec. 14, low 60s. Plus one 1-year option, mid 70s. Estimate 80 days downtime in early 2012 for planned shipyard upgrade at zero rate

ENSCO 88

   MLT 82 SD-C    250    Ras Gas    Mid 60s    Qatar    Mar. 12    Plus multiple options at escalating rates

ENSCO 91

   Hitachi    270    Saudi Aramco    Low 130s    Saudi Arabia    Jul. 11   

ENSCO 94

   Hitachi 250-C    250    Shipyard    Mid 40s    Qatar    Dec. 11    Planned shipyard upgrade approx. 60 days, Jun. to Aug. 11 (42 days at mid 40s). Then mid 60s for RasGas to Dec. 11. Plus multiple options at escalating rates

ENSCO 95

   Hitachi 250-C    250    Sold       ---------       Sold in 2Q11 for $41 million. Book value equaled $27 million

ENSCO 96

   Hitachi 250-C    250    Contracted/shipyard       Bahrain    Sep. 11    Next to Saudi Aramco to Dec. 14, low 60s. Plus one 1-year option, mid 70s. Estimate 80 days downtime in early 2012 for planned shipyard upgrade at zero rate

ENSCO 97

   MLT 82 SD-C    250    Contracted/shipyard       Bahrain    Sep. 11    Next to Saudi Aramco to Dec. 14, low 60s. Plus one 1-year option, mid 70s. Estimate 80 days downtime in early 2012 for planned shipyard upgrade at zero rate

Pride Hawaii

   Levingston    300    Cold stacked       Bahrain      

Pride Pennsylvania

   MLT    300    Cold stacked       Bahrain      

Africa

                    

ENSCO 61

   Levingston    300    Perenco    High 80s    Cameroon    Dec. 11    Plus three 1-well same rate options

Asia & Pacific Rim

Southeast Asia / Australia

ENSCO 52

   F&G L-780 Mod II-C    300    Petronas Carigali    Mid 70s    Malaysia    Mar. 13    Plus cost adjustments and one 1-year option

ENSCO 53

   F&G L-780 Mod II-C    300    Murphy    Mid 70s    Malaysia    Sep. 11   
                    

ENSCO 56

   F&G L-780 Mod II-C    300    Pertamina    Mid 70s    Indonesia    Apr. 13    Plus mutually agreed rate 6-month option

ENSCO 67

   MLT 84-CE    400    Pertamina    Low 100s    Indonesia    Jan. 13    Plus eight month option

ENSCO 104

   KFELS MOD V-B    400    ConocoPhillips    Mid 120s    Indonesia    Aug. 11    Next to shipyard for planned upgrade, inspection and mob to Oct. 11 at zero rate. Then to Apache in Australia to work to Oct. 12, mid 140s. Plus one 1-year option. Plus approx. $3,000 per day for reimbursable upgrades amortized over 1-year term contract

ENSCO 105

   KFELS MOD V-B    400    Shipyard       Singapore    Aug. 11    Next to Talisman in Malaysia to Aug. 12, mid 120s. Two 1-year options at mutually agreed rates. Upgrades amortized over Talisman’s primary contract term of approx. $6,000 per day

ENSCO 106

   KFELS MOD V-B    400    Newfield    Low
120s
   Malaysia    Mar. 12    Plus same rate 7-month option

ENSCO 107

   KFELS MOD V-B    400    Premier Oil    Low 110s    Vietnam    Jan. 12    Plus five 1-well options at index rate

ENSCO 108

   KFELS MOD V-B    400    TOTAL    High
120s
   Brunei    Jan. 12    Next to shipyard for planned inspection approx. 2 weeks at zero rate

ENSCO 109

   KFELS MOD V-Super B    350    Apache    Mid 140s    Australia    Oct. 11    Next to shipyard approx. 10 days for planned inspection at zero rate. Then 10-day mob to PTTEP, low 100s, then work to Mar. 12, mid 160s
Under Construction - uncontracted

TBD 1

   KFELS Super A    400    Under construction       Singapore    2Q13   

TBD 2

   KFELS Super A    400    Under construction       Singapore    4Q13   

 

Page 5 of 6


LOGO   Ensco plc  
  Fleet Status Report  
  22 July 2011  

 

Definitions and Disclaimers

Day Rate Definition. The day rates reflected in this Fleet Status Report are the operating day rates charged to customers, which may include estimated contractual adjustments for changes in operating costs and/or reimbursable cost adjustments for ongoing expenses such as crew, catering, insurance and taxes. The day rates, however, do not include certain types of non-recurring revenues such as lump sum mobilization payments, revenues earned during mobilizations, revenues associated with contract preparation and other non-recurring reimbursable items such as mobilizations and capital enhancements, and the impact of the fair market value adjustments to Pride’s drilling contracts in place on the 31 May 2011 acquisition date. Routine and non-routine downtime may reduce the actual revenues recognized during the contract term. Additionally, the Company occasionally negotiates special rates with customers as noted in the comments that reduce revenues recognized during the contract term.

Rig Names. Upon completion of the merger with Pride International, Inc., we intend to rename Pride’s fleet in accordance with our naming convention. We are in the process of completing these name changes, some of which may not be completed for some time. For purposes of our Fleet Status Report, we are using the new names even when the name change has not been completed. Below is a legend showing the name changes.

 

Legend of Ensco rig names to Pride International rig names

ENSCO DS-1    Pride Africa    ENSCO 5001    Pride South Pacific
ENSCO DS-2    Pride Angola    ENSCO 5002    Pride Sea Explorer
ENSCO DS-3    Deep Ocean Ascension    ENSCO 5003    Pride South Seas
ENSCO DS-4    Deep Ocean Clarion    ENSCO 5004    Pride Venezuela
ENSCO DS-5    Deep Ocean Mendocino    ENSCO 5005    Pride South Atlantic
ENSCO DS-6    Deep Ocean Molokai    ENSCO 5006    Pride North America
ENSCO DS-7    Deep Ocean Marquesas    ENSCO 58    Pride North Dakota
ENSCO 6000    Pride South America    ENSCO 59    Pride Tennessee
ENSCO 6001    Pride Carlos Walter    ENSCO 61    Pride Cabinda
ENSCO 6002    Pride Brazil    ENSCO 91    Pride Montana
ENSCO 6003    Pride Rio de Janeiro    Pride Hawaii    Pride Hawaii
ENSCO 6004    Pride Portland    Pride Pennsylvania    Pride Pennsylvania
ENSCO 5000    Pride Mexico    Pride Wisconsin    Pride Wisconsin

Forward Looking Statement. The statements contained in this Fleet Status Report that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, statements involving future rig rates, cost adjustments, utilization, our estimated rig availability, contract duration, customers or contract status, rig enhancement projections, shipyard construction or work completion, and other contract commitments, including new rig commitments, contract terms, the period of time and number of rigs that will be in a shipyard for repairs, maintenance, enhancement or construction and scheduled delivery dates for new rigs. Such statements are subject to numerous risks, uncertainties and assumptions, including but not limited to, uncertainties relating to the level of activity in offshore oil and gas exploration and development, exploration success by producers, oil and gas prices, competition and market conditions in the contract drilling industry, shipyard delays and related risks, actions and approvals of third parties (including delays in our customers’ ability to obtain drilling permits in the U.S. Gulf of Mexico and elsewhere), possible cancellation or suspension of drilling contracts as a result of mechanical difficulties or performance or other reasons, our ability to enter into and the terms of future contracts, the availability of qualified personnel, labor relations and unionization efforts, operating hazards, changes in the commencement dates of new contracts, the actual amount of downtime (including downtime incurred by reason of enhanced blow-out preventer certification and testing requirements), factors resulting in reduced applicable dayrates, hurricanes and other weather conditions, terrorism, political and other uncertainties inherent in global operations (including the risk of war, civil disturbance, seizure or damage of equipment and exchange and currency fluctuations), the impact of governmental laws and regulations, the adequacy of sources of liquidity, the effect of litigation and contingencies and other factors described above and discussed in our most recently filed Form 10-K, in our Forms 10-Q for subsequent periods and in our other filings with the SEC, which are available free of charge on the SEC’s website at www.sec.gov or by contacting our Investor Relations Department at 713-917-2244 or by referring to the Investor Relations section of our website at www.enscoplc.com. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to publicly update or revise any forward looking statements, except as required by law.

U.S. Gulf of Mexico. Certain Ensco rigs in the U.S. Gulf of Mexico have been and may be further affected by the regulatory developments and other actions that have or may be imposed by the U.S. Department of the Interior. Ensco rig utilization and day rates have been negatively influenced due to regulatory requirements and delays in our customers’ ability to secure drilling and associated permits. Current or future NTLs or other directives, legislation or regulations may further impact our customers’ ability to obtain permits and commence or continue deep- or shallow-water operations in the U.S. Gulf of Mexico. We continue to work with our customers on mutually agreeable contingency plans for our deepwater rigs in the U.S. Gulf of Mexico. In certain cases, we have negotiated reduced day rates with existing customers and/or sublet agreements with other customers in the U.S. Gulf of Mexico or elsewhere.

Ensco has rejected all force majeure notices received since the Macondo well incident as invalid under the terms of the applicable drilling contracts. During mid-December 2010, Ensco received a force majeure notice from Nexen regarding ENSCO 8501. Following delivery of the force majeure notice, Nexen only paid the $280,000 force majeure rate (75% of the mid-$370,000 invoiced applicable day rate at the time) under recent invoices. Ensco, in turn, notified Nexen that it is in default, which Nexen has denied. Ensco has commenced litigation to resolve the dispute.

The full impact of the government’s actions and the regulations discussed in this note and potential new regulatory, legislative or permitting requirements has not yet been determined, but could have a further material adverse effect upon our results of operations.

 

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