Today (2 January 2012), KCA DEUTAG, one of the world’s largest international drilling contractors, announced it has been awarded a five and half year contract by the Sakhalin Energy Investment Company Ltd. (Sakhalin Energy) to provide drilling services on the Piltun, Lunskoye and Molikpaq platforms north-east of Sakhalin Island. The contract has extension options which could take it to 2021.

KCA DEUTAG has been contracted by Sakhalin Energy since 2003. Significant factors in the success of the tender were the company’s commitment to Health Safety and Environment, having achieved 12 months without a recordable incident, its continued focus on operational improvement and impressive Non Productive Time (NPT) figures.

Rune Lorentzen, Senior Vice President, Platforms, said: “I am proud to lead the platform drilling division within KCA DEUTAG. We have secured this long term contract by delivering safe, effective and trouble free operations and consistently meeting our customer’s expectations. Securing this contract provides a platform to develop further opportunities in the Sakhalin region where successful exploration activities will undoubtedly lead to more long-term development projects.

“This long-term contract will also enable us to further develop the local capability required to deliver successful services for Sakhalin Energy and future clients.”

Valery Cholovsky, Sakhalin Energy Technical Director, said: “We are pleased to continue our professional relationship with KCA DEUTAG. They have done good work for us helping to put the Lunskoye and Piltun-B platform rigs in operation, and then drill the gas wells in time to achieve the first LNG exports from the Russian Federation. I am particularly pleased with their safety record and their efforts to employ and pass on their knowledge to Russian nationals. I look forward to a long continued and mutually beneficial working relationship with them.”

This award marks continued growth for KCA DEUTAG who was awarded offshore and onshore contracts totalling more than $1.6bn in 2010. Earlier this month, the platform drilling division, now responsible for 36 platform operations worldwide, secured a significant contract from TAQA Bratani to supply platform drilling and maintenance services to four North Sea drilling platforms (Eider, Tern, North Cormorant and Cormorant Alpha).

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Notes for Editors

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Photography from the official signing ceremony is attached, caption as follows:
Contract Signing Ceremony – left to right: Andrei Galaev CEO Sakhalin Energy Investment Company, Valery Cholovsky Technical Director Sakhalin Energy Investment Company, Rune Lorentzen KCA Deutag Senior Vice President Platforms, Phil Woods KCA Deutag Country Manager Sakhalin

KCA DEUTAG is one of the world’s leading drilling and engineering contractors. It operates more than 100 drilling rigs in over than 22 countries employing 8,000 people in Africa, Europe, Russia, Middle East, the Caspian Sea and South East Asia. The company owns a fleet of more than 60 land rigs, 3 jack-ups and 3 self-erect tender barges; it is also the largest global platform drilling contractor. Last year, KCA DEUTAG was awarded offshore and onshore contracts totaling more than $1.6bn. Particular highlights include multimillion dollar agreements in Europe and Africa as well as entry in the dynamic Brazilian oil and gas markets.

Sakhalin Energy Investment Company Ltd. (Sakhalin Energy) is the operator of the Sakhalin-2 project under a Production Sharing Agreement with the Russian Federation. The company was formed in 1994 to develop the Piltun-Astokhskoye oil field and the Lunskoye gas field in the Sea of Okhotsk offshore Sakhalin Island in the Russian Far East. Sakhalin Energy is a unique partnership drawing upon global oil and LNG expertise and experience. Under the shareholding structure of Sakhalin Energy, Gazprom holds 50% plus 1 share, Shell 27.5%, Mitsui 12.5% and Mitsubishi 10%.