DryShips COO Talks Drillships IPO

(DryShips story updated to provide further commentary from the company's COO)

NEW YORK (TheStreet) -- DryShips (DRYS) hopes to move a step closer to selling off a chunk of its offshore energy exploration business in an IPO "within the next two quarters," the company's operating chief, Pankaj Khanna, said Thursday.

In an interview with TheStreet during a shipping-industry investor conference here, Khanna said DryShips expects to win long-term charter contracts on "at least two" of the four so-called ultra-deepwater drillships currently being built for the company at a shipyard in South Korea.

DryShips already has two offshore drilling vessels in operation, one in the Black Sea and the other off the coast of Ghana, in West Africa.

DryShips' Leiv Eiriksson, a deepwater oil-drilling vessel

Investors have been hotly anticipating the announcement of a charter deal from DryShips for some time.

That's because the charters are crucial to a drillships IPO. Only by hiring out two of the oil exploration vessels -- capable of operating at depths of up to 10,000 feet below the surface -- can DryShips guarantee the kind of cash flow necessary to create an independent company and float shares to the public.

"The time table [for a public offering] is still based on getting two charters," Khanna said. "That's the minimum requirement for doing an IPO."

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