GlobalSantaFe exits land drilling with $316M sale to Calgary-based Precision

Ray Tyson

Petroleum News Houston correspondent

Big U.S.-based contract driller GlobalSantaFe, wanting to concentrate on the offshore, has agreed to sell its worldwide land drilling business to Calgary-based Precision Drilling for $316 million, the companies said April 2.

The sale, which doubles the size of Precision’s international fleet, includes 31 land rigs in the Middle East, North Africa and South America and an extensive fleet of specialized rig transport equipment that supports land rig operations in Kuwait and the Kuwaiti-Saudi Arabia Partitioned Neutral Zone. The transaction is expected to close during the 2004 second quarter.

“While we have been successful with the land rig business over the years, it has become an increasingly smaller part of our overall operations,” said Jon Marshall, GlobalSantaFe’s chief executive officer. “This transaction will permit us to focus our management efforts on growing the offshore market.”

Hank Swartout, Precision’s chief executive officer, said the transaction gives the company an opportunity to expand its growing international position.

“We recognize the excellent quality of both the rigs we are acquiring and the people associated with GlobalSantaFe’s land drilling operations,” Swartout said. “This combination with Precision’s focus on international land drilling services will strengthen our product offerings …”

GlobalSantaFe’s fleet of 59 offshore rigs includes premium and heavy-duty harsh environment jack-ups, semi-submersibles, and dynamically positioned ultra-deepwater drillships. Additionally, the company has three rigs under construction.

Precision, with headquarters in Houston, Texas, and Calgary, Alberta, is a global oilfield services company that provides a broad range of drilling, production and evaluation services. The company employs more than 10,000 people conducting operations in more than 30 countries.