The Associated Press March 2, 2010, 12:58PM ET

Diamond Offshore gets contracts worth up to $1.36B

Diamond Offshore Drilling Inc. said on Tuesday that it has entered drilling contracts with Petrobras in Brazil worth as much as $1.36 billion, plus potential bonus payments.

The contracts for three floating drilling rigs include:

-- A three-year deal for the ultra-deepwater semisubmersible Ocean Valor, worth up to $493 million in revenue. The company is preparing to move the rig from Singapore to Brazil, with work expected to begin in the middle of this year.

-- A three-year deal for the deepwater semisubmersible Ocean Baroness, worth up to $307 million in revenue plus a potential 5 percent performance bonus. That rig will be moved from the Gulf of Mexico to Brazil, with work expected to begin in the third quarter.

-- A five-year deal for the deepwater drillship Ocean Clipper, worth up to $557 million in revenue, plus a potential 5 percent performance bonus. The rig is already working for Petrobras under a contract that runs through mid-December.

Diamond also said Petrobras will use the Ocean Courage in Brazil beginning late in the second quarter, rather than in the Gulf of Mexico as previously planned.

Diamond Offshore shares fell 49 cents to $87.09 in afternoon trading. U.S.-traded shares of Petrobras rose 14 cents to $16.26.


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