Rowan Companies of the US is to resume construction of a jack-up rig that was suspended in February due to the financial crisis and market downturn.

Rowan said work would recommence on the third 240C class rig, the Joe Douglas, at its Vicksburg, Mississippi shipyard.

"Earlier this year we halted construction on this rig due to concerns over the turmoil in the credit markets and the downturn in jack-up drilling markets," said Rowan chief executive Matt Ralls.

"Based on improvements in the credit markets and our confidence in our liquidity outlook through 2010, we have elected to resume construction."

"We believe that this very capable, high specification rig will generate an attractive return on capital based on its expected go forward cost of $150m and will be delivered in 2011."

Rowan expects capital expenditures for 2009 to increase by $20m to $25m to around $550m as a result of the revision on its newbuilding plan.