Diamond Offshore Drilling

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Diamond Offshore Drilling, Inc.
Public company
Traded as
Industry Petroleum industry
Headquarters Houston, Texas
Key people
Ms. Campbell, Chairman
Marc G. Edwards, CEO & President
Products Offshore drilling
Revenue Decrease $1.485 billion (2017)
Increase $18 million (2017)
Total assets Decrease $6.250 billion (2017)
Total equity Increase $3.774 billion (2017)
Owner Privately owned
Number of employees
2,400 (2017)
Website www.diamondoffshore.com
Footnotes / references
[1]

Diamond Offshore Drilling, Inc. is an offshore drilling contractor. The company is headquartered in Houston, Texas and has major offices in Australia, Brazil, Mexico, Scotland, Singapore and Norway.[1]

Current operations[edit]

The company operates 17 drilling rigs including 13 semi-submersible platforms and 4 drillships.[1]

In 2017, Anadarko Petroleum accounted for 24.9% of the company's revenues, Petrobras accounted for 18.9% of the company's revenues, Hess Corporation accounted for 16.0% of the company's revenues, and BP accounted for 15.8% of the company's revenues.[1]

Operations outside of the United States accounted for 58% of the company's revenues in 2016.[1]

History[edit]

Diamond Offshore's beginnings can be traced back to the earliest days of the offshore drilling industry. Its predecessor companies were ODECO, Zapata Corporation, and Diamond M Drilling Co.

Diamond Offshore’s roots date back to May 1953, when Alden J. (Doc) Laborde founded ODECO in New Orleans. Laborde had designed what was probably the first submersible drilling rig. After finding a financial backer in Charlie Murphy of Murphy Oil, a grateful Laborde built the rig in 1954 and named the unit Mr. Charlie in honor of his benefactor. Today, the Mr. Charlie is a museum and training facility in Morgan City, Louisiana.

After noticing the stability of submersible rigs when they were only partially submerged for relocation, Laborde designed and constructed the first purpose-built semi-submersible platform, Ocean Driller, in 1964. ODECO rigs performed well in the 1970s; Ocean Viking discovered the giant Ekofisk oil field for Phillips Petroleum Company in the North Sea and Ocean Victory discovered the Piper oilfield and Claymore field, also in the North Sea, for Occidental Petroleum.

In the early 1960s, Brewster-Bartle, an onshore drilling company, filed for bankruptcy. The banks that had become the owners of the company’s rigs contacted Don McMahon to take over the failed company. McMahon accepted the challenge and formed Diamond M Drilling Co. in 1964. He named the company after Diamond M Acres, his ranch near Simonton, Texas. McMahon took his company public in 1970 and expanded into offshore waters with the building and purchase of jackup rigs, barges, and semi-submersible platforms. In the early 1970s, Diamond M was one of the largest owners of barge rigs in the petroleum industry. The company continued to drill both on land and offshore. In 1977, Western Oceanic tendered a hostile offer to buy Diamond M. Diamond M rejected the offer and was acquired by Kaneb Services for $102 million.[2]

In 1992, Diamond M Corporation purchased all of the outstanding stock of ODECO Drilling Inc. from ODECO Oil and Gas Co., a subsidiary of Murphy Oil. Shortly thereafter, Diamond M Corp. briefly changed its name to Diamond M-ODECO Drilling Inc. before becoming Diamond Offshore Drilling, Inc. in 1993. Diamond Offshore began trading on the New York Stock Exchange in October 1995. In April 1996, it acquired Arethusa for $516 million in stock.[3]

Between 2014 and 2017, the company retired or sold 12 rigs and recorded over $1.0 billion in impairment charges.[1]

On February 8, 2016, the company discontinued payment of a quarterly cash dividend.[1]

Controversies[edit]

Worker asbestos exposure[edit]

In 1989, Diamond's predecessor bought six drilling rigs from the predecessor of Kaneb Management Co. LLC. Some of Kaneb's employees continued to work for Diamond after the transaction and then sued Diamond for personal injuries they allegedly suffered from asbestos exposure while they worked for Kaneb.[4] In a 2013 filing with the SEC, Diamond acknowledged that its equipment had been used for the "manufacture and use of asbestos-containing drilling mud," but sought to be indemnified from liability.[5]

References[edit]

  1. ^ a b c d e f g "Diamond Offshore Drilling, Inc. 2017 Form 10-K Annual Report". U.S. Securities and Exchange Commission.
  2. ^ "Corporation Affairs". The New York Times. November 30, 1977.
  3. ^ SALPUKAS, AGIS (December 9, 1995). "Diamond Offshore Is Planning Takeover of Oil-Rig Competitor". The New York Times.
  4. ^ "Diamond Offshore Pulled Back Into Asbestos Liability Fight". Law360. June 11, 2013.
  5. ^ Gibb, Gordon (October 1, 2013). "Offshore Drilling Giant Says "Not Guilty" in Drilling Mud Lawsuit". Lawyers and Settlements.