OREANDA-NEWS. On December 12, 2007 TNK-BP announced the results of tenders launched in August this year for drilling and sidetracking rigs and, separately, for workover rigs, reported the press-centre of TNK-BP.

Tenders were open to both Russian and international contractors, and a total of twenty five companies participated.

TNK-BP is awarding long term contracts totaling over $3 billion dollars for drilling and workovers, including $1 billion dollars in long term contracts for TNK-BP’s own drilling and workover companies.

Typically contracts awarded have a term of between three and five years – with options for TNK-BP to extend their term further. The contracts will deliver highly competitive prices for TNK-BP, reducing the company’s previously forecast drilling and workover rig inflation expectations and improving safety standards.

These contracts will provide TNK-BP with advanced technology drilling rigs for its operations and the capability to drill highly deviated, step out production wells. In workovers they will facilitate the introduction of TNK-BP technical standards, the extension of the operating lives of submersible pumps and selective use of specialist fishing and well killing services.

Specifics of the contracts awarded include:

53 long term drilling and sidetracking rig contracts.

211 long term workover rig contracts, as well as a further 192 workover rigs on a 1-year basis with firm price options for TNK-BP to extend those contracts by up to 2 years.

An increase in long term contract coverage to 64% of TNK-BP’s drilling fleet and 70% of TNK-BP’s workover fleet, reducing the company’s exposure to rising rig rates in a tight drilling market.

26 additional new drilling and sidetracking rigs, so that one third of TNK-BP’s fleet by the end of 2008 will be new.

Two new international companies, Weatherford and Nabors, attracted into the West Siberian drilling market to increase competition and introduce international technology and standards into the Russian market.

Winners of the drilling and sidetracking rig tenders include Integra Drilling, the Orenburg Drilling Company (OBK), Catobneft (CAToil) and the TNK-BP drilling companies (Nizhnevartovskburneft (NvBN), Nizhnevartovsk Well Repair Company 1 (NPRS-1) and Orenburgburneft (OBN)) as well as Weatherford and Nabors.

Winners of the workover tender are Obnefteremont (Integra Group), Catobneft (CAToil), SKRS (Petroalliance), the Belorussian Well Stimulation and Capital Repair Company, Permnefteotdacha, Incomneft, and the TNK-BP workover companies (Chernogornefteservice and the Capital Workover Company).

During 2008 separate contracts for specialist drilling services (including cementing, mud fluids, directional drilling) and specialist workover services (including fishing and well killing services) will be awarded. 

Tim Summers, Chief Operating Officer of TNK-BP, commented: “Our long term rig contracting process has been successful in several respects.  We have now secured the bulk of the rigs needed to deliver our production goals on a long term basis. Eleven new high tech drilling rigs and fifteen new sidetracking rigs will start to work for us in the course of 2008, enhancing our capability, underpinning performance improvement, reducing the impact of lifting cost inflation and bringing higher standards of HSE and operational efficiency.“

Sergei Brezitsky, Executive Vice President of TNK-BP, added: “We are pleased to welcome a number of new contractors, including Weatherford and Nabors, who will bring their experience and expertise to West Siberia for the first time.  And we are delighted to have achieved these goals – securing rigs, enhancing capability, attracting new contractors – at a competitive price.”

Notes to Editors:
The tenders were open to both Russian and international contractors with a total of 25 companies participating.

Drilling and sidetracking rigs
TNK-BP contracts a fleet of 96 development drilling rigs, of which 35 are sidetracking and 61 are drilling rigs. Of this total, 49 rigs are operated by TNK-BP’s in house drilling business. In addition to the development rigs, TNK-BP contracts c.30 exploration drilling rigs.

TNK-BP has an in-house drilling business. It is currently investing over $500 million in a rig upgrade programme.

TNK-BP HSE standards are an integral part of each contract. The contractors are required to report safety statistics in accordance with internationally recognized procedures. Additionally, for long-term contracts, joint TNK-BP/ contractor project management teams will be established.

Workover rigs
TNK-BP contracts a fleet of 550 rigs which are used for workover operations in Western Siberia and the Orenburg region. Of these 150 rigs are operated by TNK-BP owned service companies.

TNK-BP HSE standards are an integral part of each contract. The contractors are required to report safety statistics in accordance with internationally recognized procedures. Additionally, for long-term contracts, joint TNK-BP/ contractor project management teams will be established.