Newbuild Delay
Ensco recently entered into an amendment to the ENSCO DS-10 drillship construction contract (the “Amendment”) with Samsung Heavy Industries (“SHI”), the shipyard constructing the ENSCO DS-10 (“Drillship”). Under the terms of the Amendment: The delivery date for the Drillship has been extended to March 31, 2019 (the “Extended Delivery Date”). Ensco may elect to take delivery of the Drillship earlier upon giving SHI 75 days’ advance notice. Notwithstanding the Extended Delivery Date, SHI agreed to complete construction of the Drillship by March 31, 2017. Payment of $75 million of the approximately $309 million unpaid balance of the purchase price for the Drillship has been deferred to March 31, 2019, or such earlier date as Ensco may elect to take delivery of the Drillship. The remaining $234 million of the purchase price is to be paid in January 2017.