Maersk Drilling has entered right into a definitive settlement to amass the newbuild harsh atmosphere jack-up rig from struggling rival Hercules Offshore (Nasdaq: HERO).

According to the settlement, Maersk Drilling assumes the proper to take supply of the rig, previously named Hercules Highlander, instantly from Jurong Shipyard Pte Ltd (Jurong) in Singapore and Maersk agrees to settle the ultimate cost of roughly $190 million.

After supply, the rig can be mobilized to the North Sea to begin a five-year drilling contract with Maersk Oil and its companions, BP and JX Nippon, on the Culzean gasoline area offshore UK. The worth of the five-year drilling contract is roughly $420 million, together with a mobilization price of $9 million.

The rig was initially ordered in May 2014 for a shipyard value of $236 million.

The deal comes as Hercules Offshore plans its second chapter submitting in simply 9 months as the corporate struggles with the continuing decline in oil costs.

“This agreement represents an opportunity for Maersk Drilling to acquire a newbuild harsh environment jack-up backed by a firm long-term contract. We look forward to working with Maersk Oil and its partners on the Culzean gas field,” says CEO in Maersk Drilling and member of the Executive Board within the Maersk Group, Claus V. Hemmingsen.

The rig design is Friede & Goldman JU2000E, categorized as a 400-foot rig, with 30,000-foot drilling depth and HPHT (High Pressure High Temperature) capabilities. The rig has lodging capability for as much as 150 personnel.

The rig will enter the Maersk Drilling fleet beneath the title Maersk Highlander, and after the acquisition, Maersk Drilling’s rig fleet counts 23 rigs with a further harsh atmosphere jack-up rig beneath building.