ExxonMobil Exploration and Production Ireland (Offshore) Limited, a unit of ExxonMobil Corporation ( XOM - Analyst Report ) , has formally informed partner Providence Resources P.l.c. the signing of a letter of intent with offshore drilling contractor Ocean Rig UDW Inc. ( ORIG - Snapshot Report ) for the ultra deepwater semisubmersible drilling rig, Eirik Raude.

Per the terms of the Letter of Intent, the rig Eirik Raude will be employed to spud an exploration well at Dunquin, situated in Frontier Exploration Licence (FEL) 3/04, offshore Ireland. The rig is expected to be operational in the first quarter of 2013 and drilling will likely be completed in about 6 months. However, the contract is subject to agreeable contract and corporate and co-venturer consent.

ExxonMobil Exploration and Production Ireland (Offshore) Limited, the operator of FEL 3/04, holds an interest of 27.5%. The other co-partners Eni SpA ( E - Analyst Report ) , Repsol S.A ( REPYY ) , Providence Resources and Sosina Exploration Limited hold 27.5%, 25%, 16% and 4% stakes, respectively.

The deal will augment ExxonMobil’s operations as Dunquin forms a vital part of Dublin-based Providence's ongoing Irish multi-basin, multi-well drilling program. The company’s venture with Providence Resources – which controls most of Ireland’s offshore acreage – will allow joint development of oil fields in offshore Ireland as well as access to the know-how for developing unreachable resources. The deal could unlock huge oil reserves in the unexploited offshore province of Ireland. These developments will boost Exxon’s earnings in the near future.

ExxonMobil boasts diversified operations across the world with several new projects expected to come online through 2013. While Exxon functions in all corners of the globe, the main areas of focus for the coming years include the U.S., Canada, Kazakhstan, West Africa, Australia, Russia, Angola and Iraq for new volumes. On the exploration front, it includes unconventional natural gas across North America as well as offshore regions, including the Gulf of Mexico.

ExxonMobil carries a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. Longer term, we maintain our Neutral recommendation.