Tuesday, June 15, 2010

Statoil A/S (STO, STL.OS) is moving to suspend its contracts for two drilling rigs in the Gulf of Mexico

  NEW YORK (Dow Jones)--Statoil A/S (STO, STL.OS) is moving to suspend its
contracts for two drilling rigs in the Gulf of Mexico, citing the U.S.
moratorium on offshore drilling.

  The Norwegian oil company is invoking a force-majeure clause in its contracts
with Transocean Inc. (RIG) and Maersk Drilling. The clause allows for an early
end to a contract if outside factors beyond the companies' control prevents the
rig from operating. Anadarko Petroleum Corp. (APC) and Cobalt International
Energy Inc. (CIE) had previously declared force majeure on three rigs.

  President Barack Obama on May 27 announced a six-month moratorium on offshore
drilling, as criticism of the industry swelled in the weeks after a rig
drilling a well for BP PLC (BP, BP.LN) caught fire and sank off the coast of
Louisiana. The well has gushed oil into the Gulf of Mexico ever since. In the
Gulf of Mexico, the moratorium has idled more than 30 rigs operating in deeper

   "The moratorium has created a very challenging situation for all parties
involved in [Gulf of Mexico] deep water drilling, with considerable cost
exposure as well as many operational, legal and other challenges facing rig
operators, partners, suppliers and contractors," said Ola Morten Aanestad, a
Statoil spokesman, in an email.

  Aanestad said Statoil intends to resume drilling in the Gulf of Mexico when
the moratorium is lifted, and "will continue to explore routes and evaluate
options that could minimize the impact for all parties involved."

  The rig operators have yet to respond to Statoil's notice, though another
driller, Noble Corp. (NE), has disputed Anadarko's invoking of force majeure on
one of its rigs.

  Typically, a company declaring force majeure pays close to the full amount of
the rig's lease for several weeks. Statoil has a contract for Transocean's
Discoverer Americas through October 2013 at a rate of $482,000 a day, according
to the driller's website. Maersk's rig is also leased through October 2013.

  -By Brian Baskin, Dow Jones Newswires; 212-416-2453;

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