Oil and Natural Gas Corporation will hire two rigs from Transocean of the United States and Dolphin Drilling of the United Kingdom for a period of three years to launch its deep-sea drilling campaign in the Arabian Sea and the Bay of Bengal by October.

"Transocean Deepwater Drilling Inc and Dolphin Drilling Ltd have been awarded the much delayed deep-sea rig tender worth Rs 3557 crore (Rs 35.57 billion)," senior company officials said in New Delhi on Monday.

ONGC will pay Dolphin $361,762.54 per day for the Belford Dolphin, while Transocean will receive $336,906.10 per day for the Discoverer Seven Seas.

The fees will also cover the integrated management services that Dolphin and Transocean will provide in consortia with Tidewater and Schlumberger, respectively, the official, who did not want to be identified, said.

Belford Dolphin will drill in 3000-plus metre depths in the Bay of Bengal and the Arabian Sea, while Discoverer Seven Seas will drill in water depths of 1500 metres.

The industry sources said Transocean had initially offered $351,607.20 per day, while Dolphin put a bid of $362,877.37 per day.

"The post-bid negotiations saw Transocean lowering its rates four times, while Dolphin lowered its rates just once," they said.

ONGC plans to begin drilling for oil and gas soon after the monsoon. A 37-well drill campaign is planned by India's largest oil exploration and production firm, which has been left behind by Reliance Industries Ltd and Cairn Energy of UK in exploring for oil and gas in the deepwater.

Both Cairn and RIL have struck gas reserves in the Krishna Godavari Basin, off the Andhra coast.

ONGC plans to begin its deepwater campaign with the first well in a KG Basin exploration block in the KG Basin, lying next to RIL's gigantic gas field, company officials said.

"Stage is now set for beginning our much delayed deepwater campaign," the official said, adding ONGC had begun looking for a deep-sea rig 18 months ago.

ONGC was looking for two rigs - one capable of drilling upto 1800 metres below the sea and the other capable of drilling upto 3000 metres - plus related technical and management services on three-year contracts since it does not have the required deepwater experience.

The American firm had offered drill ships Discoverer 534, Deepwater Frontier and Discoverer Seven Seas for the 1800 metre category with Schlumberger Asia Services Ltd providing the integrated campaign management services, he said.

It had also offered rig Deepwater Pathfinder, Deepwater Discovery and Deepwater Millennium for the 3000-metre category but was beaten by Dolphin Drilling Ltd.

Besides, Smedvig, Fred Olsen and Nobel Drilling have offered only drill rigs (without integrated services). Noble is understood to have offered Muravlenko, while Smedvig had offered West Navigator for the deeper category.

The tender committee has not evaluated the individual bids as ONGC had preferred integrated service provider and had stated that it would go in for individual categories only when it fails to find an integrated bidder, the official added.