Mobile offshore drilling unit (MODU)

Three forms dominate. The jack-up, which stands on the seabed on its legs and suits shallow water. The semi-submersible, whose submerged pontoons steady the platform over a deep well. The drillship, which moves faster from site to site. All three are MODUs, mobile offshore drilling units. The operator does not own them: a drilling contractor, the owner of the unit, rents it to the field operator at a day rate, and the insurance tracks that split. The owner insures the unit on hull terms, with maritime liability, in the hull policy. The operator insures the well under well control. The drilling contract draws the line through a knock-for-knock exchange of waivers of recourse: each bears losses to its own people and property, whatever the other's fault. That balance holds for nearly every loss, except pollution coming from the well, attributed to the operator, and pollution coming from the unit, attributed to the contractor. The specific hazards are storms, loss of position of the drillship (dynamic positioning) and, for the jack-up, a sudden punch-through of the legs into ground that gives way. The rare but heavy loss is a lost unit, whose replacement value runs to around half a billion dollars for a deepwater vessel.