In its fleet status report issued this week the company has said it is preparing the rig for cold stacking, meaning the rig will be idled, crew let go, and all the hatches welded, cutting the costs to a minimum.
Cold stacking is done when the operators think a rig will be unable to get a meaningful contract for a considerable amount of time. For comparison, warm stacking means a rig will be idle, but with crew on board, ready for quick redeployment.
Offshore drillers have recently been under pressure to get new contracts for their rigs as the demand has been affected by plunging oil prices and cuts in drilling budgets by their customers, the oil companies.
However, as Douglas Westwood, an industry intelligence group, recently said, the drillers themselves are partly to blame as the offshore drilling sector is experiencing an oversupply of drilling rigs. Transocean, one of the world’s largest drillers this week said it would delay deliveries for 5 new jack-ups.
As for the stacking, in order to cut costs the drilling contractors are shelving their older units, which the Rowan Louisiana is, considering it was built in 1975. Until recently the rig worked for EnVen in the U.S. Gulf of Mexico.
In its previous monthly rig fleet report, Rowan said it had cold stacked Rowan Juneau and Rowan Alaska jack-ups, delivered in 1977 and 1975 respectively.
The older rigs eventually get retired for good and scrapped as their potential for future contracts drops to a minimum, as more new rigs with better technical specifications enter the market.