D P Jindal Group offshore oil and gas drilling equipment provider Jindal Drilling and Industries today said it had received a three-year Rs850-crore rig-leasing order from ONGC.

According to Jindal Drilling, ONGC will charter hire the drilling unit Noble George McLeod for three years, which will be deployed next month, though the contract is effective from 15 October.

Jindal Drilling presently operates two 350-ft jack-up cantilever B class jack-up rigs Noble Ed Holt and Noble Charlie Yester.

Noble Charlie Yester is currently under construction at Keppel Fels, Singapore, by Virtue Drilling Pte Ltd. (VDPL) and   has been contracted to ONGC for the current order. Jindal Drilling had acquired a 49-per cent stake from sister concern Jindal Pipes Ltd in VDPL in March 2008 for Rs40 crore.

The other jack-up rig Noble Ed Holt by Jindal Drilling's Singapore-based joint venture Discovery Drilling Pte Ltd, and also constructed by Keppel Fels, was delivered on 12 September 2008 and was leased out to ONGC last month for Rs810 crore ($165-million ).

Both the rigs have been contracted to ONGC and Jindal Drilling will be acting as contractor for these rigs.

The order book of Jindal Drilling with this current order stands at Rs3,700 crore. With this, the total number of directional drilling equipment will be twenty two and rig fleet will be five. This order will add to the existing healthy order book position of the company and improve the financial performance in the coming years.

Last month Jindal Drilling formed a joint venture with Sevan Marine to manage and operate a deepwater drilling unit that will be chartered to ONGC. Jindal will hold 22.5 per cent of the JV, while Sevan will hold the remaining 77.5 per cent. Sevan will manage the rig, with Jindal supporting the operations in India.

Sevan exercised two options with China's Cosco Shipyard for the hull construction of two deepwater rigs earlier this year. ONGC is expected to charter one of two new rigs for a period of three-year from December 2010. The new rig is expected to have a rated water depth of at least 10,000 feet (3,048 m).