UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): March 18, 2015

 

 

Diamond Offshore Drilling, Inc.

(Exact Name of Registrant as Specified in Charter)

 

 

 

Delaware   1-13926   76-0321760

(State or Other Jurisdiction

of Incorporation)

  

(Commission

File Number)

  

(IRS Employer

Identification No.)

15415 Katy Freeway

Houston, Texas 77094

(Address of Principal Executive Offices and Zip Code)

Registrant’s telephone number, including area code: (281) 492-5300

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate line below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 7.01. Regulation FD Disclosure

Diamond Offshore Drilling, Inc. (the “Company”) hereby incorporates by reference into this Item 7.01 the summary report of the status, as of March 18, 2015, of the Company’s offshore drilling rigs attached as Exhibit 99.1.

The information contained in Item 7.01 and Exhibit 99.1 to this report is being furnished in accordance with Rule 101(e)(1) under Regulation FD and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be incorporated by reference into any previous or future registration statement filed under the Securities Act of 1933, as amended (the “Securities Act”), unless specifically identified therein as being incorporated by reference.

Statements in the summary report furnished as Exhibit 99.1 to this report that are not historical facts are “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Such statements include, but are not limited to, statements concerning drilling rig deliveries, operations and timing; contract effectiveness, effective dates and estimated duration; plans regarding retirement and scrapping of drilling rigs; expectations of future backlog, revenue, operating costs and performance; revenue expected to result from backlog; current term, future dayrates, future status, start and end dates and future contracts and availability; future contract opportunities and termination rights; contract noncompliance by customers and other third parties; letters of intent; utilization, surveys, downtime and other aspects of the Company’s drilling rigs; statements concerning customer discussions and outcomes thereof and the impact of these and related events on the Company’s operations and revenues; rigs being upgraded or to be upgraded and rigs under construction; and other statements that are not of historical fact. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those currently anticipated or expected by management of the Company. A discussion of the risk factors and other considerations that could materially impact these matters as well as the Company’s overall business and financial performance can be found in the Company’s reports filed with the Securities and Exchange Commission, and readers of this report are urged to review those reports carefully when considering these forward-looking statements. These risk factors include, among others, risks associated with worldwide demand for drilling services, level of activity in the oil and gas industry, renewing or replacing expired or terminated contracts, contract cancellations and terminations, maintenance and realization of backlog, competition and industry fleet capacity, impairments and retirements, declaration of dividends, operating risks, changes in tax laws and rates, regulatory initiatives and compliance with governmental regulations, timing of construction of new builds, casualty losses and various other factors, many of which are beyond the Company’s control. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of such statement, and the Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.

 

2

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

 

Exhibit number

   

Description

99.1    Rig Status Report as of March 18, 2015

 

3

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

DIAMOND OFFSHORE DRILLING, INC.
By:   /s/ David L. Roland
  David L. Roland
  Senior Vice President, General Counsel and Secretary

Dated: March 18, 2015

 

4



Exhibit 99.1

 

LOGO     

Diamond Offshore Drilling, Inc.

Rig Status Report

March 18, 2015

Updated information noted in bold print

RECENT COMMITMENTS (See Body of Report For Contract Details)

No new contract commitments

 

    Water1
Depth		         Year 3           Contract
Dayrate		   Estimated   Estimated         Planned Downtime  4
(For Periods Lasting >10 days)		      

Rig Name

   (feet)    

Type2

  

Built

   Location  

Operator

  

(USD)

  

Start Date

   End Date   Status     1Q15 E     2Q15 E     3Q15 E     4Q15 E    

Comments

                    Totals:        563        356        190        60     
                   

 

 

    

 

 

    

 

 

    

 

 

    

Gulf of Mexico - U.S.

                      

Ocean Star

     5,500      SS 15K   1997   US GOM   —     —     —     —       Actively marketing             

Ocean Victory

     5,500      SS 15K   1997   US GOM   —     —     —     —      
 		 Customer Prep/
Standby		  
  		          
        US GOM   —     —     late Mar 2015   early May 2015    
 		 Mobe to Trinidad;
customs clearance		   
  		     10        30          Mobe
        Trinidad   BP   398,000   early May 2015   early May 2017    
 
 		 2-year term + 1-
year unpriced
option		  
  
  		          

Ocean Onyx

     6,000      SS 15K   2014   US GOM   —     —     late Feb 2015   mid Apr 2015    
 
 		 Prep, mobe to
Trinidad,
acceptance		   
  
  		     32        15          Prep, mobe, acceptance
        Trinidad   BG International   390,000   mid Apr 2015   mid Aug 2015     One well             
        Trinidad   BG International   360,000   mid Aug 2015   mid Oct 2015     One well             

Ocean BlackHawk

     12,000      DS 15K DP   2014   US GOM   Anadarko   495,000   late May 2014   mid Jun 2019    
 		 5-year term +
unpriced option		   
  		     11            Installation of 2nd BOP

Ocean BlackHornet

     12,000      DS 15K DP   2014   S. Korea   —     —     early Dec 2014   late Mar 2015    
 
 		 Mobe to GOM;
customer
acceptance		   
  
  		     85            Mobe, acceptance testing
        US GOM   Anadarko   495,000   late Mar 2015   late Mar 2020    
 		 5-year term +
unpriced option		   
  		          

Ocean BlackRhino

     12,000      DS 15K DP   2014   S. Korea   —     —     mid Dec 2014   late Apr 2015    
 
 		 Mobe to GOM;
customer
acceptance		   
  
  		     90        30          Mobe, acceptance testing
        US GOM   Murphy   550,000   late Apr 2015   late Jan 2016    
 
 

 
 
 
 

 265-day term; prior
to commencement
of contract, may be

converted into term
lasting until Jun
2016 at
$485,000/day

   
  
  

  
  
  
  

          
        US GOM   —     —     Jan 2016   Q4 2016     Actively marketing             
        US GOM   Hess   400,000   Q4 2016   Q4 2019     3-year Term             

Gulf of Mexico - Mexico

                      

Ocean Nugget (note 5)

     300      JU IC   1976   Mexico   Pemex   97,000   early Jul 2013   mid Aug 2016     1,136-day term             

Ocean Summit (note 5)

     300      JU IC   1972   Mexico   Pemex   85,999   mid Sep 2012   late May 2015     985-day term             

Ocean Scepter

     350      JU 15K IC   2008   Mexico   Pemex   158,000   early Jun 2014   early Mar 2016     639-day term             

Ocean Ambassador (note 5)

     1,100      SS   1975   Mexico   Pemex   211,445   early Mar 2014   early Mar 2016     730-day term             

North Sea / Mediterranean / W. Africa

                      

Ocean Nomad (note 6)

     1,200      SS   1975   UK   —     —     —     —       Actively marketing             

Ocean Guardian

     1,500      SS 15K   1985   UK   Shell   352,000   mid Jan 2015   mid Jul 2015    
 		 Continuation of 1-
year extension		  
  		       60          5-Year Special Survey

Ocean Princess

     1,500      SS 15K   1975   UK   —     —     —     —       Actively marketing             

Ocean Patriot

     3,000      SS 15K   1983   UK   Shell   400,511   late Oct 2014   late Oct 2017    
 
 		 3-year term + 2 x 1-
year unpriced
options		  
  
  		          

Ocean Valiant

     5,500      SS 15K   1988   UK   —     —     —     —       Contract prep        90            Mobe, contract prep
        UK   Premier Oil   320,000   early Apr 2015   late Aug 2015    
 		 Two wells + 4 x 1-
well options		  
  		          

Ocean Endeavor

     10,000      SS 15K   2007   Black Sea   ExxonMobil   521,665   late Jun 2014   late Dec 2015    
 
 
 

 
 

 18-month term
(dayrate incl. 50%
of potential 6.6%
bonus)

+ 6 x 6-month
unpriced options.

   
  
  
  

  
  

          

Ocean Confidence

     10,000      SS 15K DP   2001   Canary Islands   —     —     late Apr 2014   late Mar 2015     Maintenance        90            Maintenance
          —     —     —     —       Actively marketing             

 

Please refer to accompanying disclaimer as well as Diamond Offshore’s 10-K and 10-Q filings with the SEC.

    Page 1 of 4

    Water1
Depth		         Year 3           Contract
Dayrate		   Estimated   Estimated       Planned Downtime  4
(For Periods Lasting >10 days)		      

Rig Name

   (feet)    

Type2

  

Built

   Location  

Operator

  

(USD)

  

Start Date

   End Date   Status   1Q15 E     2Q15 E     3Q15 E     4Q15 E    

Comments

Australasia

                      

Ocean Quest

     4,000      SS 15K   1973   Vietnam   PVEP   198,900   late Apr 2014   late Apr 2015   Remainder of 4th well + 6
x one-well priced options		       60          Maintenance

Ocean America

     5,500      SS 15K   1988   Australia   Chevron   475,000   late Nov 2013   late May 2015   18-month term          

Ocean Apex

     6,000      SS 15K   2014   Vietnam   ExxonMobil   485,000   late Jan 2015   mid Apr 2015   One well     20            Mobe, acceptance testing

Ocean Rover

     8,000      SS 15K   2003   Malaysia   Murphy/Nippon   465,000   early Mar 2014   early Mar 2016   2-year term + 1-year

unpriced option

          

Ocean Monarch

     10,000      SS 15K   2008   Malaysia   —     —     mid Sep 2014   late May 2015   Mobe; contract prep     63        55          Mobe, contract prep
        Australia   Apache Corporation   410,000   late May 2015   late Nov 2016   18-month term + 1 year
option		          

Brazil / S. America

                      

Ocean Spur

     300      JU IC   1981   Ecuador   Saipem   30,000   mid Oct 2012   late Apr 2015   bareboat charter

+ 1 x 6-month priced
option

          

Ocean Lexington (note 5)

     2,200      SS   1976   Trinidad   BG Intl / Centrica   300,000   early Nov 2013   mid Jun 2015   Six wells          
        US GOM   BG Intl / Centrica   300,000   mid Jun 2015   early Jul 2015   Prep and demobe to US
GOM		          
        US GOM   —     —     early Jul 2015   late Sep 2015   Prep, 5-year special
survey, and mobe to
Mexico		       0        88        Prep, 5-year survey, mobe
        Mexico   Pemex   160,000   late Sep 2015   mid Apr 2018   Firm term          

Ocean Alliance

     5,250      SS 15K DP   1988   Brazil   Petrobras   367,089   late Jul 2010   mid Jun 2016   6-year term (incl. 50% of
potential 15% bonus) +
unpriced option		       15          Maintenance

Ocean Clipper

     7,875      DS 15K DP   1997   Brazil   Petrobras   312,625   late Jan 2015   early Dec 2015   Remainder of 5-year term
contract (incl. 50% of
potential 5% bonus)+
unpriced option		     10           

Under Water in Lieu of

Dry-dock rig inspection

Ocean Baroness (note 7)

     8,000      SS 15K   2002   Brazil   Petrobras   276,750   early Sep 2011   early Sep 2015   Remainder of 5-year term
(incl. 50% of potential 5%
bonus)		          
        Brazil   Petrobras   310,000   early Sep 2015   early Sep 2018   3-year extension          

Ocean Courage

     10,000      SS 15K DP   2009   Brazil   Petrobras   567,000   late Feb 2015   late Oct 2015   3-year extension +
$112,000 uplift (incl. 50%
of potential 6% bonus)		         10        Maintenance
        Brazil   Petrobras   455,000   late Oct 2015   late Feb 2018   3-year extension          

Ocean Valor

     10,000      SS 15K DP   2009   Brazil   Petrobras   440,000   early Sep 2011   mid Oct 2015   Remainder of 5-year term          
        Brazil   Petrobras   455,000   mid Oct 2015   mid Oct 2018   3-year extension          

Rigs Under Construction

                      

Ocean BlackLion

     12,000      DS 15K DP   2015   S. Korea   —     —     Q2 2012   Q4 2015   Hyundai shipyard;
commissioning; mobe;
acceptance		       91        92        60      Mobe, acceptance testing
        US GOM   Hess   400,000   Q4 2015   Q4 2019   4-year Term          

Ocean GreatWhite

     10,000      SS 15K DP   2016   S. Korea   —     —     Q3 2013   H2 2016   Hyundai shipyard;
commissioning; mobe;
acceptance		          
        Australia   BP   585,000*   H2 2016   H2 2019   3-year term + 2 x 1-year
priced options
(@ 585,000 + escalations);

*Dayrate to increase for
customer-requested
equipment additions

          

 

Please refer to accompanying disclaimer as well as Diamond Offshore’s 10-K and 10-Q filings with the SEC.

    Page 2 of 4

    Water1
Depth		         Year 3           Contract
Dayrate		   Estimated   Estimated       Planned Downtime  4
(For Periods Lasting >10 days)		    

Rig Name

   (feet)    

Type2

  

Built

   Location  

Operator

  

(USD)

  

Start Date

   End Date   Status   1Q15 E     2Q15 E   3Q15 E   4Q15 E  

Comments

COLD STACKED

                            

Ocean King

     300      JU IC   1973   US GOM   —     —     —     —     Stacked          

Ocean Titan

     350      JU 15K IC   1974   US GOM   —     —     —     —     Stacked          

Ocean Vanguard

     1,500      SS 15K   1982   UK   —     —     —     —     Stacked, Actively marketing          

Ocean Saratoga

     2,200      SS   1976   US GOM   —     —     —     —     Stacked          

Ocean Yorktown

     2,850      SS   1976   Mexico   —     —     —     —     Prepare for cold stacking in US GOM          

Ocean General

     3,000      SS   1976   Malaysia   —     —     —     —     Stacked          

Ocean Worker

     4,000      SS   1982   US GOM   —     —     —     —     Stacked     62            Mobe, prep for stacking

RETIRED

                            

Ocean Epoch

     3,000      SS   1977   Malaysia   —     —     —     —     Sold          

Ocean Yatzy

     3,300      SS DP   1989   Brazil   —     —     —     —     Sold          

Ocean Winner

     4,000      SS   1976   Brazil   —     —     —     —     Prep for exportation, scrapping          

NOTES

(1.) Water Depth refers to the rig’s rated operating water depth capability. Often, rigs are capable of drilling or have drilled in greater water depths.

(2.) Rig Type and capabilities: JU=Jack-up; SS=Semisubmersible; DS=Drillship; 15K=15,000 PSI Well-Control System; DP=Dynamically Positioned Rig; IC=Independent-Leg Cantilevered Rig.

(3.) Year Built represents when rig was (or is expected to be) built and originally placed in service or year redelivered with significant enhancements that enabled the rig to be classified within a different floater category than when originally constructed.

(4.) Planned Downtime only includes downtime periods that as of this report date are, or have been, planned and estimable and do not necessarily reflect actual downtime experienced. Additional downtime may be experienced in the form of possible mobes for new jobs not yet contracted, possible acceptance testing at new jobs, and unplanned maintenance and repairs. Survey start times may also be accelerated or delayed for various reasons.

(5.) A representative of PEMEX has verbally informed us of PEMEX’s intention to exercise its contractual right to terminate its drilling contracts on the Ocean Ambassador, the Ocean Nugget and the Ocean Summit, and to cancel its drilling contract on the Ocean Lexington. As of the date of this report, we have not received written notice of termination or cancellation. We are in discussions with PEMEX regarding the rigs.

(6.) Our subsidiary has received notice of termination of its drilling contract from Dana Petroleum (E&P) Limited, the customer for the Ocean Nomad. The drilling contract was estimated to conclude in accordance with its terms in August 2015. We do not believe that Dana had a valid basis for terminating the contract, and we intend to defend our rights under the contract.

(7.) Petrobras has notified us that it has a right to terminate the drilling contract on the Ocean Baroness and has verbally informed us that it does not intend to continue to use the rig. We are in discussions with Petrobras regarding the rig.

General Notes

Average Utilization: Assume rates of 92% for DP units, 96% for conventionally moored rigs, and 98% for jack-ups. Rig utilization rates can be adversely impacted by additional downtime due to unscheduled repairs and maintenance, and other factors.

Options should be assumed to be unpriced unless otherwise indicated.

Dayrates exclude amortized revenue related to amounts earned for certain activities, such as mobe, demobe, contract preparation, etc.

Survey Costs: During surveys, normal operating expense will be incurred, plus additional costs.

US GOM=U.S. Gulf of Mexico

UWILD=Under Water in Lieu of Dry-dock rig inspection.

 

Please refer to accompanying disclaimer as well as Diamond Offshore’s 10-K and 10-Q filings with the SEC.

    Page 3 of 4

LOGO   

Diamond Offshore Drilling, Inc.

Rig Status Report

Forward-Looking Statements: This report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, without limitation, any statement that may project, indicate or imply future results, events, performance or achievements, and may contain or be identified by the words “expect,” “intend,” “plan,” “predict,” “anticipate,” “estimate,” believe,” “should,” “could,” “may,” “might,” “will,” “will be,” “will continue,” “will likely result,” “project,” “budget,” “forecast,” and similar expressions. Statements by the Company in the rig status report that contain forward-looking statements include, but are not limited to, statements regarding the current term, future dayrates, future status, start and end dates, and comments concerning future contracts and availability, future contract opportunites and termination rights, letters of intent, utilization, surveys, downtime and other aspects of the Company’s drilling rigs, as well as statements concerning customer discussions and outcomes thereof, the impact of these and related events on our operations and revenues, rigs being upgraded or to be upgraded and rigs under construction. Such statements are inherently subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or projected. A discussion of the risk factors that could impact these areas and the Company’s overall business and financial performance can be found in the Company’s reports and other documents filed with the Securities and Exchange Commission. These factors include, among others, general economic and business conditions, contract cancellations, customer bankruptcy, operating risks, casualty losses, industry fleet capacity, changes in foreign and domestic oil and gas exploration and production activity, competition, changes in foreign, political, social and economic conditions, regulatory initiatives and compliance with governmental regulations, customer preferences and various other matters, many of which are beyond the Company’s control. Given these concerns, investors and analysts should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the rig status report, and the Company undertakes no obligation to publicly update or revise any forward-looking statement.

 

Page 4 of 4

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