Rowan's Jackup Receives Contract From Royal Dutch Shell

Rowan Companies plc’s (NYSE:RDC) jack-up rig, Rowan Viking, has received a contract from a subsidiary of Royal Dutch Shell (LON:RDSa) plc RDS.A.

Rowan Viking, a N-Class ultra-harsh environment jack-up rig, has been awarded a five-well program for plugging and abandonment work on the Goldeneye platform in the Central North Sea.

Following completion of the current project with Lundin in Norway, the rig is expected to commence operations related to the new contract in June 2018. Rowan Viking’s contract with Royal Dutch Shell is likely to extend till about 100 days.

The recent contract strengthens Rowan’s fleet that continues to add to its backlog amid the commodity price volatility. The company focuses on boosting shareholder return and is open to all opportunities that add to its revenues and earnings.

About Rowan

Rowan provides services related to contract drilling to the oil and gas industries. The company has the largest number of jack up fleet among all the drillers. As of Feb 28, 2018, the drilling fleet of the company comprised 23 jackup rigs and four ultra deepwater drillships. The areas where the rigs primarily operate include the Middle East, Trinidad, North Sea’s Norwegian region, the Gulf of Mexico and the United Kingdom.

Rowan’s new offshore drilling entity — ARO Drilling — has recently commenced activities. Each of Rowan and Saudi Aramco has 50% ownership in ARO. The new firm will be able to participate in the growing offshore drilling market of Saudi Arabia.

Price Performance

Rowan’s shares have lost 32.9% in the last three months, compared with the industry’s 16.4% decline.

Zacks Rank & Key Picks

Rowan carries a Zacks Rank #3 (Hold).

A few better-ranked players in the same sector are Pioneer Natural Resources Company (NYSE:PXD) and Concho Resources Inc. (NYSE:CXO) . Both the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Headquartered in Irving, TX, Pioneer Natural Resources is an independent oil and gas exploration and production entity. It pulled off an average beat of 66.92% in the trailing four quarters.

Concho Resources is an independent oil and natural gas company. It delivered a positive surprise of 48.9% during the same time frame.

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