Buccaneer Energy Ltd. (BCC.AU) said Thursday it has agreed to pay Transocean Ltd. (RIG) $68.5 million for a shallow-water rig the oil and natural gas producer plans to take to Alaska's Cook Inlet.

Buccaneer hopes to have the GSF Adriatic XI in southern Alaska and ready to drill by next spring. The sale is scheduled to close next month, after which the rig will be hauled to an Asian shipyard to be outfitted for Alaska's harsh conditions, Buccaneer said.

The rig is capable of drilling in up to 300 feet of water. The 28-year-old jackup has sat idled in Malaysia for more than a year, according to Transocean's most recent fleet status report. A Transocean spokesman confirmed the sale but declined to comment further.

Buccaneer is one of several independent oil and gas explorers taking a renewed interest in Cook Inlet.

With drilling dating back to 1958, the inlet on Alaska's southern coast is the state's original oil patch. In recent decades, however, Cook Inlet was largely ignored as producers turned instead to the vast reserves on Alaska's North Slope.

Producers have been prompted to return by a new U.S. Geologic Survey study suggesting that Cook Inlet holds nine times more natural gas than previously believed along with the state's high gas prices and a slew of tax incentives.

The Alaska Industrial Development and Export Authority has, for example, agreed to lend Buccaneer and its partner Ezion Holdings Ltd. (5ME.SG) $30 million to help buy the rig, bring it to Alaska and drill at least four offshore wells.

The state agency will recoup its money with proceeds from the resulting wells, a spokesman said.

Shares of Transocean recently traded 21 cents, or 0.37% higher at $56.23.

-By Ryan Dezember, Dow Jones Newswires, 713-547-9208, ryan.dezember@dowjones.com

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