OSLO (Bloomberg) ? SeaDrill Ltd., an oil-drilling company set up by shipping billionaire John Fredriksen, said second-quarter profit rose as rising demand for offshore services boosted rig rates.

Net income at the Bermuda-based company, which was established in May last year, rose to $33.3 million, or seven cents a share, from $620,000 in the year-earlier period, it said yesterday. Analysts polled by the news service TDN Finans expected profit of $25 million.

Rental prices for drilling rigs have soared as rising oil and gas prices spur companies such as BP Plc to step up the search for new deposits. SeaDrill in April gained control of 96 percent of Smedvig ASA, Norway's largest rig owner, to expand its fleet.

"The operational results from the second part of 2006 will be stronger than the first part of 2006 as a function of an increased number of units in operation but also as a function of increasing day rates," the company said.

Total second-quarter revenue rose to $275.6 million from $191.6 million in the first quarter, while operating profit in the same period climbed to $59.1 million from $23.8 million. The company didn't provide comparison figures for sales and operating profit in the second quarter of last year.

SeaDrill was expected to post operating profit of $51 million on $243 million in sales, according to the median estimate of analysts polled by TDN Finans.

"The rig market has continued to show strength across all categories and classes of mobile offshore drilling units in 2006," the company said. "This trend is anticipated to continue over the next years assuming no fundamental change to the price of oil."

Crude oil prices in New York have gained 14 percent so far this year. Prices rose to a record $78.40 a barrel in July. SeaDrill said oil companies' demand for rigs "remains robust".