Regulation and Policy

This week’s fortnightly edition of DecomWorld news includes Precision Drilling; Hercules Offshore; Oil & Gas UK; Wood Group, Marine Well Containment Company.

Precision shares plans for decommissioning of rigs

Alberta, Canada-based oilfield services company Precision Drilling has confirmed the decommissioning of 36 Tier 3 drilling rigs and 13 service rigs from its fleet and the company expects to take a pre-tax charge to earnings in the range of CAD$100 million to $120 million for the fourth quarter of 2011.

Following the decommissioning and planned new build deliveries as of December 31, 2011, Precision expects its rig fleet will stand at 338 rigs, including 188 rigs in Canada, 144 rigs in the United States and six rigs internationally.

Precision Drilling confirmed that its planned capital expenditures for 2012 are $1.14 billion.

The 2012 capital expenditure plan includes $738 million for expansion capital, $232 million for sustaining and infrastructure expenditures and $173 million for upgrade and long-lead time item expenditures.

In 2012, the company plans to deploy further capital for new rig builds and upgrades as well as further investments into infrastructure. This investment includes expanding field support presence with new facilities and logistics support investments in Texas, North Dakota and Alberta in order to reduce operating costs, improve up-time and customer service capabilities.

Hercules International appoints new president

Houston, Texas-based Hercules Offshore has announced the retirement of Don P. Rodney from the company, where he currently serves as President of the Cayman Islands based Hercules International Holdings.

The development is going to be effective as of December 31, 2011. 

Assuming the role of President of Hercules International will be Claus E. Feyling, who currently serves as Vice President, International Business Development.

UK Working Time Directive compliant

The Supreme Court in the UK has upheld the previous rulings of the Court of Session and Employment Appeal Tribunal that time off work enjoyed by UK offshore oil and gas workers more than meets the minimum legal amount of annual leave that employers must provide their employees.

Industry trade association Oil & Gas UK, welcomed the verdict, highlighting that typical rotas worked offshore allow for over 26 weeks onshore, away from work, more than meeting the requirement of the Working Time Directive to provide 5.6 weeks’ annual leave.

The Supreme Court hearing focused on whether offshore workers were entitled to holiday time in addition to the time they spend onshore on ‘field break’ away from work. As per the information available, a typical UK offshore worker works a two week on, two week off rota which means they spend over 26 weeks a year onshore on field break away from work. Therefore, the rota more than meets the requirement of the Working Time Directive to provide 5.6 weeks’ annual leave. 

Wood Group bags two contracts

Energy services company Wood Group has bagged two contracts from Marine Well Containment Company (MWCC), the not-for-profit, independent company focused on improving capabilities for containing a deepwater well control incident in the U.S. Gulf of Mexico.

Wood Group companies Wood Group PSN and Mustang will provide technical support services for MWCC’s containment system to be used in the event of a deepwater well control incident in the U.S. Gulf of Mexico. 

Wood Group PSN is helping MWCC enhance plans and procedures to maintain MWCC’s interim containment system equipment. Mustang is assisting MWCC in the analysis of drillship oil & gas processing equipment. Mustang will conduct steady state and transient modeling of subsea equipment, evaluate hydrate condition and mitigation, and develop process simulation modules.