December 2, 2010
Source: Noble Corp.
Noble Corporation (NYSE: NE) has received notice from Marathon Oil Company (NYSE: MRO), its customer for the ultra-deepwater semisubmersible Noble Jim Day, of Marathon’s intent to exercise its right of termination if the unit does not commence operations by December 31, 2010.
As previously disclosed, Marathon has the right to terminate the drilling contract in the event the unit is not ready to commence operations by December 31, 2010. Marathon further provided notice that it believes the failure of the U.S. Department of the Interior to finalize deepwater drilling and spill response regulations and the Department’s decision to withhold new deepwater drilling permits is a force majeure event. Additionally, Marathon attempted to provide notice of a force majeure condition under the contract in the event the rig is accepted by December 31, 2010.
The Company continues to work diligently with Marathon to complete acceptance testing and believes the rig is materially complete and that Marathon should fulfill its contractual obligation to accept the rig prior to December 31, 2010. The Noble Jim Day arrived in the U.S. Gulf of Mexico on September 24, 2010 to begin its final acceptance process for Marathon.
In light of Marathon’s notice, the Company is evaluating all of its options and intends to vigorously defend its rights under the drilling contract. Additionally, the Company is considering alternative operational opportunities for the unit in the event Marathon attempts to reject the rig