Ensco plc

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Ensco plc
Type Public limited company
Traded as NYSEESV
S&P 500 Component
Industry Oil and gas services
Founded 1987 (Dallas)
Headquarters London, United Kingdom (incorporation)
San Felipe Plaza
Houston, Texas, USA (operational)[1]
Key people Daniel Rabun (Chairman, President, and CEO)
Revenue Increase$2.450 billion USD (2008)
Operating income Increase$1.402 billion USD (2008)
Net income Increase$1.151 billion USD (2008)
Website www.enscoplc.com
An Ensco offshore platform in the Persian Gulf
ENSCO DS6 Drillship taking on fuel bunkers in Walvis Bay, Namibia during the transit to Angola and start of contract with BP.

Ensco plc is a multinational oil and gas services company headquartered in London, United Kingdom. It is the world's second-largest offshore oil and gas well drilling company, and has 49 offshore jack-ups, seven drillships and 20 semi-submersible drilling rigs.[2]

With over 7,000 employees, and annual revenue in the $2.3 billion range, the Company is publicly traded on the New York Stock Exchange under the symbol ESV.

History[edit]

ENSCO was incorporated in 1975 as Blocker Energy Corporation by longtime oilman John R. Blocker. After graduating from Texas A&M in 1948 he worked on a Gulf of Mexico oil rig for several years before establishing a South Texas drilling company with his father in 1954. When an oversupply of oil on the market crippled the contract drilling business the company was dissolved, and in 1958 Blocker went to work for Dresser Industries as operations manager for the oil equipment division in Argentina and Venezuela, a natural fit because he had grown up in South America, learning Spanish before English. Over the next several years he learned the political and financial realities of the foreign oil business, lessons that would later serve him well with Blocker Energy. In 1965 he moved to Dresser's Houston office and ultimately rose to the level of a senior vice-president. When he left Dresser in the mid-1970s Blocker bought a small drilling company that became the core of Blocker Energy, a venture he planned to run with his son along with a ranch he purchased. His attention, however, was soon fixed on the drilling company, due to a domestic exploration boom that resulted from the 1973-74 Arab oil embargo. In recent years the major oil companies had sold off their drilling operations and were now forced to turn to contract drillers like Blocker Energy. Blocker took advantage of his South American experience to position the company in the international market, believing it was less risky than the domestic market, where he would have to contend with some 800 to 900 competitors. Not only were there only a handful of international competitors, Blocker hoped to shield his company from the volatility of the oil business, notorious for boom-or-bust cycles, by placing his drilling rigs around the globe. Blocker Energy expanded rapidly to meet the demand for its services and as a result soon found itself $44 million in debt. Blocker took the company public to pay down some of the debt and fund further expansion. By the early 1980s Blocker Energy was the world's 15th largest contract drilling company, operating in eight countries with 54 rigs. Starting in late 1978 Blocker Energy made a major commitment to exploration by investing more than $50 million. Committing further millions to the effort, however, did little more than to distract the company from its core contract drilling business. The company restructured itself in the early 1980s but was devastated by a slump in oil drilling that put it on the verge of bankruptcy by the summer of 1984.

Richard Rainwater's Investment in 1986

After Blocker Energy lost nearly $3 million in 1985, it found much needed help from multimillionaire Richard Rainwater, whose BEC Ventures made an initial investment in the company in 1986. He then commenced negotiations with Blocker Energy and its creditors to acquire a controlling interest in the company. Rainwater would one day become known for his relationship with George W. Bush and their ownership of the Texas Rangers, which provided the latter with his fortune and the political platform for his successful election as governor of Texas and one day the presidency of the United States. At the time he was buying into Blocker Energy, Rainwater was already well known in financial circles as the financial advisor to the wealthy Bass brothers, heirs to a Fort Worth, Texas, oil fortune. Rainwater himself had grown up in more modest circumstances in Fort Worth. After majoring in math and physics at the University of Texas he went on to the Graduate School of Business at Stanford University, where he became friends with Sid R. Bass. Rainwater served two years at Goldman, Sachs, & Co. as a trader, and then in 1970 went to work for the Basses as a financial advisor. Over the next 16 years his advice proved so beneficial that the Basses' net worth increased from $50 million to more than $5 billion. In particular, Rainwater was responsible for the Basses buying into Disney before its dramatic increase in value. Rainwater also did well for himself, so that by the time he decided to strike out on his own he had accumulated a $100 million stake. Blocker Energy was his first solo deal, followed by a string of other investments that would result in making him a billionaire.

In December 1986 Rainwater-led BEC Ventures acquired a controlling interest in Blocker Energy. In May 1987 John Blocker stepped down as chief executive officer, although he remained chairman until his retirement in November of that year. He was replaced as CEO by Carl F. Thorne, a partner in BEC Ventures. He grew up in the oil industry, born in Texas, the son of an electrical engineer who worked for Mobil Oil Corp. for 46 years, and was raised in a Mobil field camp. After receiving a degree in petroleum engineering at the University of Texas, Thorne worked briefly as a drilling and production engineer for Tenneco Inc. before continuing his education at Baylor University School of Law, earning a juris doctor degree. He returned to the oil business, serving as assistant general counsel for Sedco Drilling Co., eventually becoming president of the company. When Sedco merged with Schlumberger in 1984, Thorne became president of the resulting drilling group. Two years later, and only in his mid-40s, Thorne retired, but soon decided to join Rainwater, taking over the running of Blocker Energy, which subsequent to the acquisition by BEC changed its name to Energy Service Company Inc., its abbreviation becoming ENSCO. The company assumed the name ENSCO International Incorporated in 1992.

ENSCO, well positioned because it possessed little debt, immediately announced plans to expand its presence in the oil drilling industry, which appeared ready to rebound after one of the worst down cycles in U.S. history. It attempted to acquire Anson Drilling Co. as well as Gearhart Industries but failed. ENSCO was more successful, however, in the transportation area, in 1988 paying $22 million to acquire Golden Gulf Offshore Inc. for ten boats that supplied offshore oil rigs and another four vessels that moved the rigs' massive anchors. Finally in 1993 ENSCO completed a major acquisition, buying Penrod Holding Corporation in 1993 and adding 19 rigs to its fleet. Penrod was owned by the Hunt family, which during the 1980s had invested heavily in the fleet, but massive debt, a downturn in drilling activity, as well as an ill-fated attempt at silver speculation, forced the Hunts to seek bankruptcy protection for Penrod and eventually led to the business being sold to ENSCO.

In 2009 Ensco announced that it would move its headquarters to London and become a UK-registered company. It stated that it did not plan to move "a large number" of employees to London and that the COO of the company would remain based in Dallas.[3]

In February 2011, Ensco agreed to acquire its rival Pride International for $7.3 billion.[4] The acquisition provided Ensco access to the lucrative Brazil and West African markets, as well as greatly diversified its asset base from being largely jack-up rigs into the drillship and semi-submersible rigs as well. As a result of the acquisition, Ensco moved its offices from Dallas to Houston.[5]

References[edit]

  1. ^ Contact Ensco
  2. ^ "Ensco shares buoyed by quarterly results". Reuters. 9 August 2011. Retrieved 2 September 2011. 
  3. ^ "Dallas-based Ensco to move headquarters to U.K." The Dallas Morning News. Tuesday November 10, 2009. Retrieved on November 13, 2009.
  4. ^ "Ensco to buy Pride International for $7.3bn". BBC News. 7 February 2011. Retrieved 2 September 2011. 
  5. ^ Ensco to close Dallas office, conduct layoffs

External links[edit]

See also[edit]