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Many of world’s deep-well rigs built in Vicksburg

Vicksburg — High oil prices have focused attention on discovering new sources of oil and gas around the world, including deep wells extending up to six miles deep beneath the floor of the ocean. A little known fact is that about 35% of the deep well jack-up, or self elevating, rigs used around the world are manufactured by LeTourneau Inc., with most of the company’s production of the deep well rigs based here in Vicksburg.

“The Bob Keller will be the 83rd jack-up rig that we have built right here,” said vice president Donald M. Cross. “Deep drilling down to 32,000 feet below the mud line under the ocean is the new thing everyone is going to now. And it takes a special rig to do that.”

Reliability and experience are one reason why LeTourneau captures such a large share of the world’s market in jack-up rigs.

“You get better the more you build,” Cross said. “If you don’t, you are out of business. Most of the rigs are being built overseas because of lower labor costs. We think we are the premier builder, and build the best jack-up rigs in the world. But a lot of companies are run by accountants, and they primarily look at the lowest cost. Ours are the best, but they are not the cheapest in the world. We have our own jacking system, and build the cranes that go on the jack-up rigs. Most of the cranes we use in the yard we also built.”

Rowan Companies Inc. of Houston, Texas, the parent company of LeTourneau, recently announced it was awarded a drilling contract by a large independent oil and gas company to drill a deep well on the outer continental shelf in the Gulf of Mexico, using the Bob Keller.

The Bob Keller is expected to leave Vicksburg May 26 to be shipped down the Mississippi River and across the Gulf Coast to Sabine Pass, Texas, where Rowan has another yard used to complete the jack-up rigs adding all the legs and the drilling derrick. Those components have to be added after the rigs pass underneath all the bridges on the Mississippi River. Finish work on the Bob Keller is expected to be complete by September 1.

‘Demand is good’

Cross said lease rates for this type of deep-well rig can average about $82,000 per day. High energy prices today have generated considerable interest in building new rigs to explore for oil and gas.

“There is a lot of interest in new-build today,” Cross said. “Demand is good. We are bidding on a lot of new rigs currently. But it won’t be an immediate fix for high oil prices. From the time a rig is ordered until it is built, transported to the area where exploration will be done, the well is drilled, and production begins is between four to five years.”

The Bob Keller has the latest in equipment for oil exploration and production, and like all other rigs manufactured at the yard in Vicksburg, the rigs are also designed to meet all state and federal environmental regulations.

Since crew members stay out on the rig for weeks at a time, the Bob Keller is also a floating hotel with living quarters for 86 crew members, and other amenities such as a television room and recreational facilities.

Maintaining high standards

LeTourneau offers the self-elevating mobile offshore drilling units in six designs, covering offshore requirements from shallow draft to harsh-environment drilling. To ensure the performance of their rigs and their related assemblies, the company conducts a wide range of finite element analyses including dynamic and non-linear analyses where appropriate, model testing, materials and other related testing.

“Each procedure is an integral element that helps maintain LeTourneau’s high standards,” Cross said.

About 850 people are currently employed at LeTourneau in Vicksburg, with employment fluctuating up and down as rigs are completed and leave. There isn’t enough skilled labor in the area to satisfy all of the demand, so LeTourneau hires about 120 contract welders and electricians from Houston and other areas to help assemble the large, technologically-sophisticated drilling rigs.

LeTourneau would like to hire more local labor, and has its own welding school to train local residents interested in a jobs that pay higher than average for the area.

“We have our own welding school,” Cross said. “We teach them a trade and pay them while they are in school in order to get good help.”

Even before the Bob Keller leaves, the company is starting another rig that is a sister ship to the Bob Keller. The keel was laid back in December, and a lot of steel is on the ground in beginning stages of assembly.

A fascinating process

Jimmy Heidel, executive director, Vicksburg-Warren County Chamber of Commerce, said it is fascinating to watch one of the jack-up rigs being built and then launched into the Mississippi River.

“They actually build them on land and through a walking process launch it into the river,” Heidel said. “It looks like it is walking into the water. When they move it into the water, they jack the legs up and float it down the river.”

Heidel said companies like LeTourneau could end up benefiting from increased drilling as a result of high energy prices.

“From what I’ve been hearing in oil and gas industry circles, if we would have a big discovery right now, it would put a stress on the number of rigs available,” Heidel said. “So that would put the construction business up for these oil and gas rigs.”

LeTourneau also does other big projects not related to oil exploration. Right now they are finishing up work on a dredge barge for the U.S. Army of Corps of Engineers to be used on the Mississippi River in Fountain City near St. Paul, Minn. The 200-foot long, 39-foot wide dredge barge is expected to ship out May 2 going upriver.

LeTourneau has been in business since 1943 designing, manufacturing, fabricating and servicing offshore drilling platforms, including the world’s largest self-elevating drilling rigs. Complete rig design and component manufacturing are performed at the company’s headquarters in Longview, Texas, while the rig construction is done by the Marine Group’s Construction Operations in Vicksburg.

Contact MBJ contributing writer Becky Gillette at bgillette@bellsouth.net.


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