RIL plans foray into rig making

Reliance Industries, the petrochemicals giant, is planning to manufacture its own rigs to overcome a global shortage of deep water drilling rigs, which is affecting its exploration business.

"We are looking to enter the rig manufacturing business," told RIL President Petroleum International Business Atul Chandra today.

The company had sought a three-year drilling holiday for exploring nine deep sea blocks, which it won through NELP auctions due to rig shortage in October 2007.

Reliance Industries (RIL) has committed to drill 73 wells in the three NELP-I blocks, five NELP-III blocks and one pre-NELP block, requiring more than 12 dig years to accomplish the programme.

Apart from this, it currently has two deep water rigs "" C Kirk Rhine and Deep Water Frontier. It had contracted three more rigs "" Expedition, D534 and Neptune "" for mobilisation by June 2006, August 2006 and January 2007 respectively, with an additional rig, Blackford Dolphin, slated to join the fleet in October 2007.

Despite executing the required contracts, the mobilisation of rigs were always subject to availability.

While Expedition is not expected to be there before October 2008, Neptune and Blackford Dolphin will not come before May 2008.

The cost of hiring for drilling rig works out $450,000 a day and it makes more business for the company to manufacture these equipment on its own.

The company may rope in a partner for this business, said Chandra, adding that RIL plans to enter this business either by this financial end or by beginning of the next.