Economic Risk Evaluation And Financing Analysis For The Purchase Of Deep-Water Drilling Rigs

At present lots of oil companies are increasing their investment on the deep-water drilling rigs for the bright prospect of ocean oil exploration. But the purchase of deep-water drilling rigs needs a relatively larger investment with higher risk. Therefore the risk analysis plays an important role in the investment of engineering project. Scientific and precise analysis of risk is the key factor to the success of the whole project. Assuming that Shengli Offshore Drilling Company of SINOPEC plan to purchase or construct a deepwater Jackup, this paper does risk evaluation on the deep-water drilling rig investment from the aspects of market, finance and financing. The feasibility of investment is also studied. Finally the optimum rig type is chosen for further purchase. In the market analysis from the views of the risk evaluation upon the offshore oil resources prospect, drilling services and market competition, the best choice for Shengli Offshore Drilling Company is to purchase or construct a Jackup rig with a cantilever of 90 meters. Finance evaluation, risk analysis and uncertainty analysis is the main content of this paper. The finance evaluation can more accurately reflect the project profitability after taking the time value of capital into consideration. As for risk analysis, this article uses some technical analysis ways to do some probability analysis upon the project profitability, and to select the best scheme by comparison. Considering the situation of Shengli Offshore Drilling Company, this paper analyzes the project financing. A joint-stock system is recommended for SODC to restructured to decrease the purchase pressure through capital market financing. The analysis in different ways shows the probability to make a profit is great whether to build a new rig or to buy a secondhand rig. The new rig would be more profitable in terms of the competition, profit and risk analysis.