v2.3.0.15
Segment Information
9 Months Ended
Sep. 30, 2011
Segment Information [Abstract] 
Segment Information
Note 15 - Segment Information
 
    In connection with the Merger, we evaluated our then current core assets and operations, which consisted of seven drillships, 20 semisubmersible rigs and 48 jackup rigs, including rigs under construction, and organized them into three segments based on water depth operating capabilities. Accordingly, we now consider our business to consist of three reportable segments: (1) Deepwater, which consists of our drillships and semisubmersible rigs capable of drilling in water depths of 4,500 feet or greater, (2) Midwater, which consists of our semisubmersible rigs capable of drilling in water depths of 4,499 feet or less and (3) Jackup, which consists of our jackup rigs capable of operating in water depths up to 400 feet. Each of our three reportable segments provides one service, contract drilling.  We also manage the drilling operations for two deepwater rigs and own one barge rig, which are included in "Other."
 
    Segment information for the three-month and nine-month periods ended September 30, 2011 and 2010 is presented below. General and administrative expense and depreciation expense incurred by our corporate office are not allocated to our operating segments for purposes of measuring segment operating income and were included in "Reconciling Items."  We measure segment assets as property and equipment. Prior year information has been reclassified to conform to the current year presentation.
 
 
 
Three Months Ended September 30, 2011
 
 
 
Deepwater  
 
 
  Midwater
 
 
  Jackup
    Other
Operating
Segments
      Total     
Reconciling
   Items   
 
Consolidated
     Total      
                 
Revenues
$   440.4
  
$121.3
  
$   330.1
   $  23.8  
$     915.6
  
$     --
  
$     915.6
  
Operating expenses
Contract drilling (exclusive
of depreciation)
233.0
  
72.1
  
154.7
   17.7  
477.5
  
--
  
477.5
  
Depreciation
73.5
  
15.7
  
44.2
    0.6  
134.0
  
1.8
  
135.8
  
General and administrative
--
  
--
  
--
    --  
--
  
40.8
  
40.8
  
Operating income (loss)
$   133.9
  
$  33.5
  
$   131.2
   $   5.5  
$     304.1
  
$(42.6
 ) 
$     261.5
  
Property and equipment, net
$8,981.7
  
$904.1
  
$2,376.7
    $ 26.6  
$12,289.1
  
$ 22.6
  
$12,311.7
  
 
Three Months Ended September 30, 2010
 
Deepwater  
  Midwater
  Jackup
    Other
Operating
Segments
      Total     
Reconciling
   Items   
 
Consolidated
     Total      
                 
Revenues
$   110.5
  
$     --
 
$   317.8
   $     --  
$   428.3
  
$     --
  
$    428.3
  
Operating expenses
Contract drilling (exclusive
of depreciation)
48.0
  
--
  
145.6
    0.5  
194.1
  
--
  
194.1
  
Depreciation
11.7
  
--
  
43.2
    0.4  
55.3
  
.3
  
55.6
  
General and administrative
--
  
--
  
--
    --  
--
  
20.6
  
20.6
  
Operating income (loss)
$     50.8
  
$     --
  
$   129.0
    $  (0.9 )
$   178.9
  
$(20.9
 ) 
$   158.0
  
Property and equipment, net
$2,769.8
  
$     --
  
$2,197.5
    $ 14.8  
$4,982.1
  
$   4.0
  
$4,986.1
  
 
Nine Months Ended September 30, 2011
 
 
 
Deepwater  
  Midwater
  Jackup
    Other
Operating
Segments
      Total     
Reconciling
   Items   
Consolidated
     Total      
                 
Revenues
$   770.8
  
$157.5
 
$   882.7
   $ 30.3  
$  1,841.3
  
$       --
  
$  1,841.3
  
Operating expenses
Contract drilling (exclusive
of depreciation)
385.0
  
95.0
  
450.4
    25.0  
955.4
  
--
  
955.4
  
Depreciation
123.7
  
20.9
  
129.8
    1.5  
275.9
  
2.9
  
278.8
  
General and administrative
--
  
--
  
--
    --  
--
  
118.3
  
118.3
  
Operating income (loss)
$   262.1
  
$  41.6
  
$   302.5
   $  3.8  
$     610.0
  
$(121.2
 ) 
$     488.8
  
Property and equipment, net
$8,981.7
  
$904.1
  
$2,376.7
    $26.6  
$12,289.1
  
$   22.6
  
$12,311.7
  
 
Nine Months Ended September 30, 2010
 
Deepwater  
  Midwater
 
  Jackup
    Other
Operating
Segments
      Total     
Reconciling
   Items   
 
Consolidated
     Total      
                 
Revenues
$    361.8
  
$      --
  
$   926.5
   $     --  
$1,288.3
  
$     --
  
$1,288.3
  
Operating expenses
Contract drilling (exclusive
of depreciation)
139.5
  
--
  
429.7
    13.3  
582.5
  
--
  
582.5
  
Depreciation
31.2
  
--
  
125.2
    1.9  
158.3
  
.9
  
159.2
  
General and administrative
--
  
--
  
--
    --  
--
  
63.2
  
63.2
  
Operating income (loss)
$   191.1
  
$      --
  
$   371.6
    $(15.2 )
$   547.5
  
$(64.1
 ) 
$   483.4
  
Property and equipment, net
$2,769.8
  
$      --
  
$2,197.5
    $ 14.8  
$4,982.1
  
$   4.0
  
$4,986.1
  
 
 
 
 
    Information about Geographic Areas
 
    As of September 30, 2011, the geographic distribution of our drilling rigs by operating segment was as follows:
 
  Deepwater     Midwater Jackup Other             Total *
             
North & South America (excl. Brazil)  6         
--       
15    
--     
21  
 
Brazil
6         
 5       
--    
--     
11  
 
Europe & Mediterranean 1          --        9     --      10    
Middle East & Africa 3           1        12      --      16    
Asia & Pacific Rim 1          --        10      1      12    
Asia & Pacific Rim (under construction) 4          --        2     --      6    
Total
21         
6       
48    
1     
76  
 
 
  * We have two deepwater drilling management contracts not included in the table above.  In October 2011, we entered into an agreement with Keppel FELS Limited to construct an ultra-high specification harsh environment jackup rig, which is not included in the table above.
 
    Certain of our drilling rigs in the U.S. Gulf of Mexico have been or may be further affected by the regulatory developments and other actions that have or may be imposed by the U.S. Department of the Interior, including the regulations issued on September 30, 2010. Utilization and day rates for certain of our drilling rigs have been negatively influenced due to regulatory requirements and delays in our customers' ability to secure drilling permits. Current or future notices to lessees or other directives and regulations may further impact our customers' ability to obtain permits and commence or continue deepwater or shallow-water operations in the U.S. Gulf of Mexico.  Additionally, regulatory or customer requirements relating to blowout prevention equipment certification, inspection and testing may adversely impact our revenues.
    
    During the three-month and nine-month periods ended September 30, 2011, revenues provided by our drilling operations in the U.S. Gulf of Mexico totaled $251.3 million and $539.4 million, or 27% and 29%, of our consolidated revenues, respectively. Of these amounts, 74% and 68% were provided by our deepwater drilling operations in the U.S. Gulf of Mexico for the three-month and nine-month periods ended September 30, 2011, respectively.  Prolonged actual or de facto delays, moratoria or suspensions of drilling activity in the U.S. Gulf of Mexico and associated new regulatory, legislative or permitting requirements in the U.S. or elsewhere could materially adversely affect our financial condition, operating results or cash flows.