Another deepwater rig leaves Gulf

HOUSTON

Diamond Offshore Drilling has pulled another rig out of the Gulf of Mexico due to restrictions on deepwater drilling in U.S. waters do to the BP oil spill.

The Houston company said this week that it has ordered the Ocean Confidence rig to the Republic of Congo. The rig departed the Gulf over the weekend and is expected to arrive off the African coast in 60 days.

Diamond Offshore said it moved the rig after rewriting a drilling contract with a subsidiary of Murphy Exploration and Production Co. Its current contract with Murphy was changed to a one-year commitment in the Gulf that will begin when Murphy is confident it can get permits to drill.

In exchange, the companies signed a new agreement to drill off the coast of the Republic of Congo.

The Congo project is expected to generate about $234 million in total revenue.

The Ocean Confidence, a massive rig that can drill to depths of 35,000 feet, has been in operation since 2001.

Last week, Diamond Offshore said it was moving another Gulf rig to Egypt.

It is widely expected that many offshore operators will move equipment out of the Gulf until the backlash from BP's out-of-control well subsides.

The well has spilled as much as 176 million gallons of oil in the Gulf, according to government estimates, the worst spill in the nation's history.