Diamond Offshore Drilling, Inc. is a leading, global offshore oil and gas
drilling contractor with a current fleet of 45 offshore rigs consisting of 30
semisubmersibles, 14 jack-ups and one drillship. Our fleet includes some of
the most technologically advanced rigs in the world, enabling us to offer a
broad range of services worldwide in various markets, including the deep water,
harsh environment, conventional semisubmersible and jack-up markets.
Semisubmersibles. We own and operate 30 semisubmersibles, consisting of 11
high-specification and 19 intermediate rigs. Semisubmersible rigs consist of
an upper working and living deck resting on vertical columns connected to lower
hull members. Such rigs operate in a “semi-submerged” position,
remaining afloat, off bottom, in a position in which the lower hull is approximately
55 feet to 90 feet below the water line and the upper deck protrudes well above
the surface. Semisubmersibles are typically anchored in position and remain
stable for drilling in the semi-submerged floating position due in part to their
wave transparency characteristics at the water line. Semisubmersibles can also
be held in position through the use of a computer controlled thruster (dynamic-positioning)
system to maintain the rig’s position over a drillsite. We have three
semisubmersible rigs in our fleet with this capability.
Drillship. We have one high-specification drillship, the Ocean Clipper. Drillships,
which are typically self-propelled, are positioned over a drillsite through
the use of either an anchoring system or a dynamic-positioning system similar
to those used on certain semisubmersible rigs. Deepwater drillships compete
in many of the same markets as do high-specification semisubmersible rigs.
Markets
The principal markets for our offshore contract drilling services are the following:
• the Gulf of Mexico, including the United States and Mexico;
• Europe, principally in the United Kingdom, or U.K., and Norway;
• the Mediterranean Basin, including Egypt, Libya and Tunisia and other
parts of Africa;
• South America, principally in Brazil and Argentina;
• Australia and Asia, including Malaysia, Indonesia and Vietnam; and
• the Middle East, including Kuwait, Qatar and Saudi Arabia.
Customers
We provide offshore drilling services to a customer base that includes major
and independent oil and gas companies and government-owned oil companies.
Competition
The offshore contract drilling industry is highly competitive with numerous
industry participants, none of which at the present time has a dominant market
share. The drilling industry has experienced consolidation in recent years and
may experience additional consolidation, which could create additional large
competitors. Some of our competitors may have greater financial or other resources
than we do. We compete with offshore drilling contractors that together have
more than 600 mobile rigs available worldwide.
The offshore contract drilling industry is influenced by a number of factors,
including global demand for oil and natural gas, current and anticipated prices
of oil and natural gas, expenditures by oil and gas companies for exploration
and development of oil and natural gas and the availability of drilling rigs.
Mergers among oil and natural gas exploration and production companies have
reduced the number of available customers.
Drilling contracts are traditionally awarded on a competitive bid basis. Intense
price competition is often the primary factor in determining which qualified
contractor is awarded a job. Customers may also consider rig availability and
location, a drilling contractor’s operational and safety performance record,
and condition and suitability of equipment. We believe we compete favorably
with respect to these factors.
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