Delays and cost overruns are straining the offshore rig construction system as the rig-building cycle gains momentum.
Costs for 25 new rigs have now escalated by $1 billion, and delivery date slippage for 28 rigs now totals 207 months. Lead time for a rig ordered today is 2-3 years.
That is the analysis Matthew G. Pilon presented earlier this month at the Simmons & Co. international oil and gas service and equipment industry seminar in Houston.
"The world needs to build more rigs," said Pilon, Simmons & Co. vice-president. The utilization rate of the global offshore rig fleet is very high, leaving few "competitive" rigs available-those able to move from one …