![Sample our Engineering & Technology journals, sign in here to start your access, latest two full volumes FREE to you for 14 days]({"type":"image" , "src" : "/sda/5933/TOC-Subject-Sample-2021-Engineering-Tech.jpg"})
ABSTRACT
The US jackup construction industry has historically been the major provider of newbuilt drilling rigs operating in state waters and on the US. Outer Continental Shelf. From 2000 to 2010, a total of 26 jackups were delivered to the US market by two US shipyards. The purpose of this paper is to examine the US construction market that supplies jackup rigs in the region. Cost, labour, and material estimates for rig construction are developed and it is estimated that between 1000 and 3500 people were directly employed by the rig newbuild industry in the US Gulf Coast between 2000 and 2010. The US jackup construction industry is geographically localised and generates about $360 million in annual revenue, but its long-term outlook is uncertain because shallow water drilling in the region has been declining for the past two decades as capital flows to onshore resource plays and the deepwater sector. Regression models for rig construction cost are used to calibrate capital expenditures and steel weight requirements.
Disclosure statement
No potential conflict of interest was reported by the authors.
Notes
1. This method assumes that the proportion of costs spent on labour are similar between the US rig and shipbuilding industries, which may or may not be justified, but the method provides a consistent means to estimate market revenue and infer employment in support of rig construction, and is amenable to the available data.
2. If a non-LeTourneau rig were specified, the leg steel costs from could be used with an additional $5–10 million allowance for the design license and jacking systems.
3. assumes additional cost for consumables, shipyard capital expenditures, profit, and other miscellaneous materials (life boats, electrical cables, furnishings, and marine equipment).