Noble Buys Frontier, Reaches Gulf Deal with Shell
June 29, 2010
According to the Associated Press, offshore drilling services company Noble Corp. is buying privately held Frontier Drilling for $2.16 billion in cash. They have also struck $4 billion worth of new contracts with Royal Dutch Shell. Noble is also giving Shell the right to suspend any contracts the two have for rigs operating in the Gulf because of the proposed U.S. moratorium on drilling in deep water. The agreements with Shell cover two ultra deepwater projects and are subject to closing the deal with Frontier. Shell will pay reduced fees for leasing Noble''s rigs in the Gulf. The Obama administration in May ordered a six-month halt on exploratory drilling in waters more than 500 feet deep. The ban is being disputed in the courts. Noble was stung earlier this month when Anadarko Petroleum said it planned to excuse itself from drilling contracts because of the moratorium. Noble spokesman John Breed said the Shell deal is aimed at keeping oil companies from trying to abandon agreements altogether in the Gulf. The Frontier deal is expected to close by the end of July. It would add six floating drilling units to Noble''s fleet.