DIAMOND OFFSHORE DRILLING, INC. - FORM 8-K - EX-99.1 - August 16, 2011

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Exhibit 99.1
1
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
RECENT COMMITMENTS — (See Body of Report For Contract Details/Date Changes and Other Information)
     
Ocean Princess
   
                                 
 
Rig Name   Nominal
WD*		   Location   Status   Operator   Current Term   Dayrate
($000s)		   Start Date   Est. End Date
                                 
Domestic Deepwater Semisubmersibles (2)
 
Ocean Victory (Note 1)
  5,500’   GOM   Current Contract   ATP   continue six-wells   low 560’s   mid May 2011   late Oct. 2011
 
Ocean Monarch
  10,000’   GOM   Current Contract   Marathon   one well   mid 290’s   mid May 2011   mid Aug. 2011
         
 
      GOM/Mobe       DODI   standby for heavy lift,
prep and mobe to
Vietnam 		      mid Aug. 2011   mid Nov. 2011
      
 
      Vietnam   Future Contract   BP   two wells + two options   mid 340’s   mid Nov. 2011   mid Feb. 2012
Domestic 2nd Generation Semisubmersibles (1)
 
 
Ocean Saratoga
  2,200’   GOM   Five Year Survey/
Actively Marketing 		  DODI           late July 2011   mid Sept. 2011
 
 
 
Domestic Jack-ups (2)
                                
 
Ocean Columbia
  250’ IC   GOM   Actively Marketing   DODI                
 
Ocean Titan
  350’ IC   GOM   Current Contract   Magnum Hunter   45 days   low 80’s   late July 2011   late Sept. 2011
         
 
      GOM   Prep for Mexico   DODI           late Sept. 2011   mid Nov. 2011
         
 
      Mexico   Future Contract   Pemex   777-day term   mid 100’s   mid Nov. 2011   late Dec. 2013
 
Note (1). Victory — In regard solely to the ATP contract, for a minimum of the first 240 days and potentially for all of the initial one-year contract period, Contract Drilling Revenue is to be recognized under normal GAAP accrual accounting at $540,000 per day, and additional contract dayrate of $20,000 is to be recognized as interest income over applicable periods reflecting deferred payment plan. The contract calls for $75,000 per day of the $560,000 contract dayrate to be paid on a current basis and the remaining $485,000 per day to be paid pursuant to an overriding royalty interest structure, as discussed in the Company’s Form 8-K that was filed on June 3, 2009. The contract may be extended beyond the initial one-year contract period for such days as are necessary to complete the drilling of a well then in progress and the dayrate for such days, if any, will be $540,000 payable in cash.
 

 

 

     
2
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
                                 
 
Rig Name   Nominal
WD*		   Location   Status   Operator   Current Term   Dayrate
($000s)		   Start Date   Est. End Date
                                 
International Semisubmersibles (25)                            
 
North Sea/Mediterranean                            
 
Ocean Nomad
  1,200’   North Sea   Current Contract   BG Intl.   four firm wells   mid 240’s   late Dec. 2010   late Oct. 2011
         
 
      North Sea   Future Contract   BG Intl.   four firm wells + one priced option well   mid 230’s   early Nov. 2011   late May 2012
 
Ocean Guardian
  1,500’   Falkland Is.   Current Contract   AGR/Desire/ Rockhopper   third firm well   mid 270’s   mid Aug. 2011   mid Sept. 2011
         
 
      Falkland Is.   Future Contract   AGR/Desire/ Rockhopper   first & second firm of 10 priced option wells   mid 270’s   mid Sept. 2011   mid Nov. 2011
 
Ocean Princess
  1,500’   North Sea   Intermediate Survey   DODI           mid Aug. 2011   late Sept. 2011
         
 
      North Sea   Actively Marketing   DODI           late Sept. 2011   early Jan. 2012
         
 
      North Sea   Future Contract   Enquest   600-day term + unpriced option   low 230’s   early Jan. 2012   late Aug. 2013
 
Ocean Vanguard
  1,500’   North Sea   Current Contract   Statoil   three-year term + unpriced option   high 340’s   mid Aug. 2010   mid June 2013
 
Ocean Endeavor
  10,000’   Egypt   Current Contract   Burullus   eight-month extension + priced options   mid 280’s   late July 2011   mid Mar. 2012
 
Ocean Confidence
  10,000’   Angola   Current Contract   Cobalt   2nd & 3rd firm wells + option   low 360’s   mid July 2011   late Jan. 2012
         
 
          Mobe to GOM   DODI           To be determined    
         
 
      GOM   Future Contract   Murphy   resume interrupted contract, 365 days + unpriced option   low 510’s   To be determined    
 
Ocean Valiant
(Note 2)
  5,500’   Angola   Current Contract   Total   two-year term   low 620’s   late Sept. 2009   mid Sept. 2011
         
 
      Equatorial Guinea   Future Contract   Hess   Four firm wells+two priced option wells   low 320’s   mid Sept. 2011   early Jan. 2012
 
Note (2). Valiant — Dayrate subject to certain potential adjustments that are not expected to be material.
 

 

 

     
3
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
                                 
Rig Name   Nominal
WD*		   Location   Status   Operator   Current Term   Dayrate
($000s)		   Start Date   Est. End Date
Australasia
                                
Ocean Patriot
  1,500’   Australia   Current Contract   PTTEP   200 day term   mid 230’s   mid June 2011   early March 2012
Ocean America
  5,500’   Australia   Current Contract   Woodside   remainder term   mid 420’s   mid March 2011   mid Aug. 2012
Ocean General
  3,000’   Indonesia   Current Contract   Premier Oil   remainder of two wells + two
unpriced option 		  low 240’s   late April 2011   late Sept. 2011
 
      Thailand   Survey   DODI           late Sept. 2011   early Dec. 2011
Ocean Rover
  8,000’   Indonesia   Current Contract   Murphy/Hess   two term + one
option well 		  high 370’s   mid Dec. 2010   mid Dec. 2011
 
      Malaysia   Maintenance   DODI/Murphy       low 150’s   mid Dec. 2011   mid Feb. 2012
 
      Malaysia   Resume Current Contract   Murphy   resume two-year ext.   low 450’s   mid Feb. 2012   late May 2012
 
      Malaysia   Future Contract   Murphy   600-day extension +
unpriced option 		  mid 280’s   late May 2012   mid Jan. 2014

 

 

4
DIAMOND OFFSHORE DRILLING,INC.RIG STATUS REPORT AS OF
August 16, 2011
     
                                                                 
 
Rig Name    Nominal WD*     Location     Status     Operator     Current Term     Dayrate ($000s)     Start Date     Est. End Date  
 
Brazil (Note 3)
                                                                
Ocean Ambassador
     1,100’     Brazil   Current Contract   OGX   3-year term   low 260’s   mid Sept. 2009   mid Sept. 2012
 
Ocean Whittington
     1,650’     Brazil   Current Contract   Petrobras   5-year term (includes 50% of pot.15% bonus)   low 240’s   late Jan. 2009   late Dec. 2011
             
 
           Brazil   Actively Marketing   DODI   remaining term transferred to Concord                        
 
Ocean Concord
     2,300’     Brazil   Current Contract   Petrobras   5-year term (includes 50% of pot.15% bonus)   high 240’s   early Jan. 2008   early Jan. 2013
             
 
           Brazil   Future Contract   Petrobras   remainder of Whittington and Yorktown terms   high 240’s   early Jan. 2013   early Aug. 2015
 
Ocean Lexington
     2,200’     Brazil   Current Contract   OGX   3-year term   mid 330’s   early Feb. 2010   early Mar. 2012
             
 
           Brazil   Current Contract   OGX   3-year term (rate reduction
blended across Star and Quest)		   low 270’s   early Mar. 2012   early Feb. 2013
 
Ocean Yorktown
     2,850’     Brazil   Current Contract   Petrobras   5-year term (includes 50% of pot.15% bonus)   low 250’s   mid Aug. 2008   mid Aug. 2011
             
 
           Demobe   Demobe to GOM, survey, prep for Mexico   DODI   remaining term transferred to Concord           mid Aug. 2011   mid Nov. 2011
             
 
           Mexico   Future Contract   Pemex   930-day term   mid 180’s   mid Nov. 2011   early June 2014
 
Ocean Yatzy
     3,300’     Brazil   Current Contract   Petrobras   5-year term (includes 50%
of pot.10% bonus)		   mid 250’s   early Oct. 2009   early Oct. 2014
 
Ocean Quest
     4,000’     Brazil   Remainder term at new blended rate   OGX   revised 2-year term   low 270’s   mid Feb. 2011   late Dec. 2011
             
 
           Brazil   Future Contract   OGX   1-year extension + second 1-year extension   low 270’s   late Dec. 2011   late Dec. 2013
 
Ocean Winner
     4,000’     Brazil   Current Contract   Petrobras   5-year term (includes 50% of pot.10% bonus)   mid 280’s   mid Oct. 2010   mid March 2015
Ocean Worker
     4,000’     Brazil   Current Contract   Petrobras   6-year term (includes 50% of pot.10% bonus)   mid 280’s   late Feb. 2009   late Feb. 2015
 
Ocean Alliance
     5,250’     Brazil   Current Contract   Petrobras   6-year term (includes 50% of pot.15% bonus)   mid 360’s   late July 2010   late June 2016
 
Note (3) — All Brazilian contracts include unpriced options                                        
 

 

 

5
DIAMOND OFFSHORE DRILLING,INC.RIG STATUS REPORT AS OF
August 16, 2011
 
                                                                 
Rig Name   Nominal WD*     Location     Status     Operator     Current Term     Dayrate ($000s)     Start Date     Est. End Date  
Brazil Cont. (Note 3)
                                                                
Ocean Star
     5,500’     Brazil   Current Contract   OGX   part one of 2-year term extension   low 310’s   mid Feb. 2011   late Dec. 2011
 
           Brazil   Future Contract   OGX   part two of 2-year term extension   low 270’s   late Dec. 2011   early Apr. 2012
 
           Brazil   Future Contract   OGX   1-year extension   low 300’s   early Apr. 2012   mid Feb. 2014
Ocean Baroness
     7,000’     Brazil   Current Contract   Petrobras   converted to five-year term (includes 50% of pot. 5% bonus)   low 270’s   early Sept. 2011   early Sept. 2015
Ocean Courage
     10,000’     Brazil   Current Contract   Petrobras   five-year term (includes 50% of pot. 6% bonus)     400 - 410     mid Feb. 2010   mid Feb. 2015
Ocean Valor
     10,000’     Brazil   Current Contract   Petrobras   converted to five-year term (includes 50% of pot. 5% bonus)   low 440’s   early Sept. 2011   mid Oct. 2015
 
           Brazil   Maintenance   DODI                   early Oct. 2011   late Oct. 2011
Drillship (1)
                                                                
Ocean Clipper
     7,875’     Brazil   Current Contract   Petrobras   5-year term (includes 50% of pot. 5% bonus)   mid 310’s   mid Dec. 2010   late Sept. 2011
 
           Brazil   Survey/Upgrade for Petrobras   DODI                   late Oct. 2011   late Jan. 2012
 
           Brazil   Resume Current Contract   Petrobras   5-year term (includes 50% of pot. 5% bonus)   mid 310’s   late Dec. 2011   early Dec. 2015
 
Note (3) — All Brazilian contracts include unpriced options                                                        

 

 

6
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
                                 
 
    Nominal                   Dayrate        
Rig Name   WD*   Location   Status   Operator   Current Term   ($000s)   Start Date   Est. End Date
International Jack-ups (7)                            
Ocean Nugget
   300’ IC   Mexico   Five Year Survey   DODI           late July 2011   early Sept. 2011
 
       Mexico   Future Contract   Pemex   430 day term   mid 80’s   early Sept. 2011   mid Oct. 2012
Ocean Summit
   300’ IC   Mexico   Current Contract   Pemex   288 day term   mid 80’s   late March 2011   late Dec. 2011
 
       Mexico   Five Year Survey   DODI           mid Aug. 2011   mid Sept. 2011
 
       Mexico   Standby and Future Contract   Pemex   985 day term   mid 80’s   late Dec. 2011   mid Sept. 2014
Ocean Scepter
   350’ IC   Brazil   Current Contract   OGX   one-year term +
unpriced option		   mid 130’s   early Feb. 2011   early Feb. 2012
Ocean King
   300’ IC   Montenegro   Actively Marketing   DODI                
Ocean Sovereign
   300’ IC   Thailand   Current Contract/Actively Marketing   Salamander   Six firm + three
unpriced option wells		   low 70’s   early Feb. 2011   mid Sept. 2011
 
       Thailand   Five Year Survey   DODI           late Sept. 2011   mid Dec. 2011
Ocean Heritage
   300’ IC   Suez Gulf   Current Contract/Actively Marketing   SUCO   six-month ext. w/ right to
terminate after 3 mo.		   high 50’s   early Feb. 2011   late Sept. 2011
 
       Suez Gulf   Five Year Survey   DODI           late Sept. 2011   early Nov. 2011
Ocean Spur
   300’ IC   Egypt   Current Contract/Actively Marketing   WEPCO   one-year extension +
unpriced option		   mid 60’s   late Oct. 2010   late Oct. 2011
RIGS UNDER CONSTRUCTION — Dynamically Positioned Drillships (3)                    
Ocean BlackHawk
   12,000’   S. Korea   Hyundai   DODI           Q1 2011   Q2 2013
 
       TBA   Future Contract   Anadarko   five-year term   mid 490’s   Q4 2013   Q4 2018
Ocean BlackHornet
   12,000’   S. Korea   Hyundai   DODI           Q1 2011   Q4 2013
 
       TBA   Future Contract   Anadarko   five-year term   mid 490’s   Q2 2014   Q2 2019
Ocean TBA
   12,000’   TBA   Hyundai   DODI           Q2 2011   Q2 2014
NOTES: Rig utilization rates can be adversely impacted by additional downtime due to unscheduled repairs and maintenance, and other factors.
On rig utilization, assume 95% for DP units, 96% for conventionally moored rigs, and 98% for jack-ups. GOM=Gulf of Mexico.
Options are un-priced and any extension of contract is subject to mutually agreeable terms & conditions unless otherwise indicated.
ALL DAYRATES EXCLUSIVE OF MOBE. Mobe revenues (if any) and mobe expenses are deferred, and generally are amortized over the life of the contract.
* Nominal Water Depth — Nominal water depth (in ft.) reflects the rig’s current operating water depth capability. Often, rigs are capable of drilling, or have drilled, in greater water depths. In all cases, floating rigs are capable of working successfully at greater depths than their nominal depth. On a case by case basis, we may achieve a greater depth capacity by providing additional equipment.

 

 

7
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
     
EXPECTED 2011 DOWNTIME — 10 DAYS OR LONGER (Subject to Change*)
         
Total DT YTD 221
        EST ‘11 Total = 988
                           
Rig   # Days   July Actual     EST Q3     Comments
Shipyard — 5-Year Surveys/Maintenance
                          
Nugget
       0       40     5-year survey/maintenance
Clipper
       0       0     5-year survey/maint/upgrade Q4 (75)
Summit
       0       35     5-year survey/maintenance
General
       0       0     5-year survey Q4 (60)
Saratoga
       0       50     5-year survey/maintenance
Sovereign
       0       8     5-year survey/maintenance Q4 (92)
Heritage
       0       0     5-year survey/maintenance Q4 (40)
Total 5-year Surveys
       0       133          
Intermediate Surveys/Acceptance Testing/Maintenance
                          
Princess
       0       45     Intermediate survey/maintenance
Total Contract Prep.
       0       45          
Contract Prep/Maintenance/Other
                          
Monarch
       0       47     Standby heavy lift/mobe Vietnam Q4(45)
Yorktown
       0       60     Mobe GOM/prep/mobe to Mexico Q4 (80)
Valor
       19       19     Maintenance
Worker
       10       10          
Titan
       0       10     Prep and mobe Mexico Q4 (80)
Scepter
       0       0     Standby
Other Total
       29       146          
Total
       29       324          
 
* Reflects currently planned downtime. Expect additional downtime in form of possible mobes for new jobs not yet contracted, possible acceptance testing at new jobs, and unanticipated maintenance. Survey start times may also be accelerated or delayed for various reasons.
Does Not Include Cold or Hot Stacked Rigs (see final page for cold stacked units).

2012 ESTIMATED SURVEY DOWNTIME = 894 days
Special Surveys: Whittington (120); Endeavor (50); Patriot (50); Quest (105); Worker (75); Star (75); Baroness (75); Victory (60); Cont. Clipper (25); King (35).
Intermediate Surveys/UWILD: Guardian (60); Columbia (12); Titan (12); Courage (10); Valor (10).
Other Prep/Maintenance: Confidence (60); Rover (60).
Survey Costs: During surveys, normal opex applies, plus additional costs.
Mobe Costs: Amortized mobe costs are generally offset by amortized mobe revenues.

 

 

     
8
DIAMOND OFFSHORE DRILLING, INC. RIG STATUS REPORT AS OF
August 16, 2011
                                 
Rig Name   Nominal
WD		     Location   Status   Operator   Order Date   Est.
Delivery Date		  
 
COLD STACKED RIGS (8 ) = (4 jack-ups, 4 semisubmersibles)
                            
 
Ocean Crusader
   200’ MC   GOM   Stacked   DODI            
 
Ocean Drake
   200’ MC   GOM   Stacked   DODI            
 
Ocean Champion
   250’ MS   GOM   Stacked   DODI            
 
Ocean Spartan
   300’ IC   GOM   Stacked   DODI            
 
Ocean Voyager
     3,200’     GOM   Stacked   DODI            
 
Ocean Epoch
     3000’     Malaysia   Stacked   DODI            
 
Ocean New Era
     1,500’     GOM   Stacked   DODI            
 
Ocean Bounty
     1,500’     Malaysia   Stacked   DODI            
 
Forward-Looking Statements: The rig status 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, letters of intent, utilization, surveys, downtime and other aspects of the Company’s drilling rigs, as well as statements concerning related legal proceedings and outcomes thereof, the impact of these and related events on our operations and revenues, the effects of claims of force majeure and the outcomes of discussions with operators with regard thereto, rigs being upgraded or to be upgraded, rigs under construction and the revised Ocean Victory contract. 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.

 

DIAMOND OFFSHORE DRILLING, INC. Reports