Transocean — BrandWiki

Transocean

Overview

Transocean Ltd.

industry
type	Public
traded as	nyse: RIG
isin	isin: CH0048265513
foundation	1973
predecessor	Sonat
hq location	Vernier, Switzerland
key people	Keelan Adamson, President & CEO Merrill A. Miller, Jr., Chairman Mark L. Mey, CFO

products	Lease and operation of semi-submersible and jack-up drilling rigs and drillships

revenue	US$3.088 billion (2019) US$1 billion (2018)

operating income	−US$721 million (2019)

net income	−US$1.257 billion (2019)

assets	US$24.105 billion (2019)

equity	US$11.867 billion (2019)

num employees	6,600 (2019)

website	http://www.deepwater.com/

footnotes	‡R1R‡

Transocean Ltd. is an American drilling company.[2] It is the world's largest offshore drilling contractor based on revenue and is based in Steinhausen, Switzerland.[3][4] The company has offices in 20 countries, including Canada, the United States, Norway, United Kingdom, India, Brazil, Singapore, Indonesia, and Malaysia.[5]

In 2010, Transocean was found partially responsible (30% of total liability) for the Deepwater Horizon oil spill resulting from the explosion of one of its oil rigs in the Gulf of Mexico.[6]

The primary business of Transocean is contracts with other large companies in the oil and gas industry. In 2019, Royal Dutch Shell accounted for 26% of the company's revenues, while Equinor accounted for 21% of the company's revenues, and Chevron accounted for 17% of the company's revenues.[1]

History

Transocean was formed as a result of the merger of Southern Natural Gas Company, later Sonat, with many smaller drilling companies.[7]

In 1953, the Birmingham, Alabama-based Southern Natural Gas Company created The Offshore Company after acquiring the joint drilling operation DeLong-McDermott from DeLong Engineering and J. Ray McDermott. In 1954, the company launched Rig 51, the first mobile jackup rig, in the Gulf of Mexico. In 1967, the Offshore Company went public. In 1978, SNG turned it into a wholly owned subsidiary. In 1982, it was changed to Sonat Offshore Drilling Inc., reflecting a change in its parent's name.[8] William C. O'Malley, an executive at Sonat's headquarters in Birmingham, was named the company's first Chief Executive Officer in 1992. In 1993, Sonat spun off the majority of its ownership in the company.[9] Sonat sold its remaining 40% stake in the company during a secondary public offering in late 1995.

In 1996, the company acquired Norwegian group Transocean ASA for US$1.5 billion.[10]

Acquisitions

In 2000, Transocean acquired R&B Falcon Corporation, owner of 115 drilling rigs, in a deal valued at $17.7 billion. With the acquisition, Transocean gained control of what at the time was the world's largest offshore operation.[31] Among R&B Falcon's assets was the Deepwater Horizon.

In 2011, the company acquired Aker Drilling, which owned 4 harsh environment rigs used for drilling near Norway.[32]

Effective on January 30, 2018, the company completed its acquisition of Songa Offshore.[33] Later that year in December, the company acquired Ocean Rig for $2.7 billion.[34][35]

Controversies

Accidents and incidents

Transocean was rated as a leader in its industry for many years. However, since the company's 2007 merger with GlobalSantaFe, Transocean's reputation has suffered considerably, according to EnergyPoint Research, an independent oil service industry rating firm. From 2004 to 2007, Transocean was the leader or near the top among deep-water drillers in "job quality" and "overall satisfaction." In 2008 and 2009, surveys ranked Transocean as last among deep-water drillers for "job quality" and next to last in "overall satisfaction." In 2008 and 2009, Transocean ranked first for in-house safety and environmental policies, and in the middle of the pack for perceived environmental and safety record.[36] The Deepwater Horizon explosion and massive oil spill, starting in April 2010, further hurt its reputation. "Transocean is dominant, but the accident has definitely tarnished its reputation for worker safety and for being able to manage and deliver on extraordinarily complex deepwater projects," said Christopher Ruppel, an energy expert and managing director of capital markets at Execution Noble, an investment bank.[37]

Transocean Leader accident (2002)

External links

Official website
Subsidiaries of Transocean LTD. worldwide (as of December 31, 2018)] (U.S. Securities and Exchange Commission)

References

Transocean Ltd. 2019 Form 10-K Annual Report U.S. Securities and Exchange Commission^
Susan M. Albring, Randal J. Elder, Mitchell A. Franklin. Transocean and the History of Tax Inversions Issues in Accounting Education, 2019^
Transocean Ltd: Overview

Deepwater Horizon drilling rig explosion (2010)

On 20 April 2010, a fire was reported on a Transocean-owned semisubmersible drilling rig, Deepwater Horizon. Deepwater Horizon was a RBS8D design of Reading & Bates Falcon, a firm that was acquired by Transocean in 2001. The fire broke out at 10:00 p.m. CDT UTC−5 in US waters of Mississippi Canyon Block 252 in the Gulf of Mexico. The rig was 41 mi off the Louisiana coast. The US Coast Guard launched a rescue operation after the explosion which killed 11 workers and critically injured seven of the 126-member crew.[44][45]

Deepwater Horizon was completely destroyed and subsequently sank.[46][47]

As the Deepwater Horizon sank, the riser pipe that connected the well-head to the rig was severed. As a result, oil began to spill into the Gulf of Mexico. Estimates of the leak were about 80,000 barrels per day – for 87 days, resulting in 134 million gallons of oil being released into the Gulf.[48]

Louisiana Governor Bobby Jindal declared a state of emergency on 29 April, as the oil slick grew and headed toward the most important and most sensitive wetlands in North America, threatening to destroy wildlife and the livelihood of thousands of fishermen. The head of BP Group told CNN's Brian Todd on 28 April that the accident could have been prevented and focused blame on Transocean, which owned and partly manned the rig.[49]

Transocean came under fire from lawyers, representing the fishing and tourism businesses that were hit by the oil spill, and the United States Department of Justice for seeking to use a Limitation of Liability Act of 1851 to restrict its liability for economic damages to $26.7 million.[50]

During Congressional testimony, Transocean and BP blamed each other for the disaster. It emerged that a "heated argument" broke out on the platform 11 hours before the accident, in which Transocean and BP personnel disagreed on an engineering decision related to the closing of the well.[51] On 14 May 2010, US President Barack Obama commented, "I did not appreciate what I considered to be a ridiculous spectacle… executives of BP and Transocean and Halliburton [the firm responsible for cementing the well] falling over each other to point the finger of blame at somebody else. The American people could not have been impressed with that display, and I certainly wasn't."[52]

Transocean later claimed that 2010, the year in which the disaster occurred, was "the best year in safety performance in our company’s history". In a regulatory filing, Transocean said, "Notwithstanding the tragic loss of life in the Gulf of Mexico, we achieved an exemplary statistical safety record as measured by our total recordable incident rate and total potential severity rate." They used this justification to award employees about two-thirds of the maximum possible safety bonuses.[53][54] In response to broad criticism, including from Interior Secretary Ken Salazar, the company announced that its executives would donate the safety portion of the bonuses to a fund supporting the victims' families.[55]

Deepwater Horizon drilling rig explosion (2010)

Deepwater Horizon was completely destroyed and subsequently sank.[46][47]

Transocean

History

Acquisitions

Controversies

Accidents and incidents

Transocean Leader accident (2002)

See also

External links

References

Galveston Bay explosion (2003)

Maintenance citation on Transocean Rather (2005)

Sinking of Bourbon Dolphin supply boat and Transocean Rather accident (2007)

2008 fatalities

Deepwater Horizon drilling rig explosion (2010)

Offshore drilling leak off the Brazilian coast (2011)

Transocean Winner grounding on the Isle of Lewis, Scotland (2016)

Transocean Leader accident (2002)

Galveston Bay explosion (2003)

Maintenance citation on Transocean Rather (2005)

Sinking of Bourbon Dolphin supply boat and Transocean Rather accident (2007)

2008 fatalities

Deepwater Horizon drilling rig explosion (2010)

Offshore drilling leak off the Brazilian coast (2011)

Transocean Winner grounding on the Isle of Lewis, Scotland (2016)