A US $1.4 billion deal is close to being sanctioned that will see two ultra-deepwater drillships built at China’s Cosco Qidong Shipyard.

DI hears that Houston-based drillship specialist X-Drill is close to finalising arrangements with Cosco that will see the yard move ahead with building the duo for eventual use in Mexico’s emerging deepwater province. It is further understood that Houston-based X-Drill is in advanced talks with Mexican oil services provider Oro Negro over a potential acquisition of X-Drill by the latter, with the drillships a key factor in the move – in fact, DI is told it’s a done deal.

Perhaps significantly, Steve Meheen – who is now Chief Operating Officer at Oro Negro – was until recently CEO of X-Drill before joining the Mexican company. Prior to X-Drill he was President and COO of Frontier Drilling.

According to one source, the contract to build the two dynamically-positioning drillships at Cosco is due to be effectuated before the end of October, with the agreement also including options for four more units. If the order is placed, as expected, the first drillship would be delivered in late 2016, DI hears, with the second to follow around six months later. Each unit would cost between $650-700 million in total.

The drillships, based on a customised version of Ulstein Sea of Solutions’ award-winning X-BOW-hulled XDS 3600 design (pictured here), would be capable of operating in water depths of up to 3,660 m (12,008 ft) and drilling wells to a total depth of 15,000 m (49,215 ft). They can also be fitted with 20,000 psi rated, 7-Ram Blow Out Preventors (BOPs), with two BOPs able to be used and stored on the units.

Both units would play a key part in Mexican state-owned major Pemex’s drilling program to explore and develop its deep and ultra-deepwater reserves in the Gulf of Mexico (see last issue of DI, page 1).