Hans Jacob Bassoe, Esgian

This week Northern Ocean, Valaris and Diamond Offshore announced new contracts, while Japan Drilling semisub Hakuryu-5 completes drilling operations offshore Japan. Meanwhile, Seadrill announced the sale of seven jackups to ADES.

Rig owner Northern Ocean announced a new contract award for the semisub Deepsea Bollsta from Shell involving work off Namibia. The contract is expected to commence in the middle of Q4 2022 and has an estimated firm duration of twelve months plus one six-month option. Rig manager Odfjell Drilling informed that it will immediately begin reactivation activities and mobilisation preparations. The rig’s last contract was with Lundin Energy (now Aker BP) off Norway, which ended in Q1 2022. 

Valaris has secured new work for Mexico, Australia, and the UK North Sea.Semisub Valaris DPS-5 has been awarded a three-well charter with Eni for work off Mexico starting in Q4 2022 and running for about 240 days. The operating dayrate is $313,500, plus a mobilisation fee of approximately $1.2 million. Heavy-duty, harsh-environment jackup Valaris 122 received a four-well extension with a duration of 500 days with Shell for work in the UK North Sea. This will be undertaken in direct continuation of the existing programme. The contract value is over $60 million. Off Australia, an undisclosed operator awarded a one-well charter to jackup Valaris 107. Operations are scheduled to start either late in Q1 or early Q2 2023 at an operating dayrate of $120,000. The duration is approximately 60 days. DNO exercised a one-well option for heavy-duty, ultra-harsh-environment jackup Valaris 247 for work in the UK North Sea. The estimated duration is 45 days and will be in direct continuation with the existing contract.

Diamond Offshore has been awarded new contracts for the semisub Ocean Apex in Australia and drillship Vela in the US Gulf of Mexico. The new contract for Ocean Apex was awarded by Inpex Operations Australia Pty Ltd (Inpex) and is for work on the Northwest Shelf of Australia. The contract includes two wells and is expected to commence in Q4 2023 in direct continuation of the previous contract. The semisub is now fully contracted until late 2024. For the second contract, the drillship Vela has been contracted to BOE Exploration & Production LLC (Beacon) for a minimum of 225 days and includes additional options for up to five to seven wells. The work is expected to commence in Q1 2023 and the contract value is approximately USD 88 million.

Drilling and discoveries

Neptune Energy informed that exploration well 35/6-3 S in its operated production licence 929 off Norway encountered a 73-metre oil column. As per the operator, preliminary estimates place the size of the discovery between 2.5 and 6.2 million Sm3 of recoverable oil equivalent. The licensees will assess the discovery along with other discoveries/prospects in the vicinity with a view toward a possible development utilising existing infrastructure on the Gjøa field. Drilling was carried out by the harsh-environment semisub Deepsea Yantai, which is now mobilising to drill wildcat well 6608/1-1 S in PGNiG-operated production licence 1017 in the Norwegian Sea.  

Aker BP concluded the drilling of wildcat well 6507/3-16 in its operated production licence 941, in the Norwegian Sea off Norway. The well was found to be dry and was plugged and abandoned. Drilling was carried out by the harsh environment semisub Deepsea Nordkapp, which is next scheduled to drill production well 6507/5-A-3 AH on the Aker BP-operated Skarv field in the Norwegian Sea. 

Jackup Valaris 107 completed its engagement with Vermilion Energy off Australia. The rig is next scheduled to undertake a two-well job with Jadestone Energy off Australia, following which it will commence drilling at Eni's Blacktip field during Q4 2022. 

Demand

Transocean semisub Development Driller III has arrived off Aruba, where it will remain until it has secured follow-on work. The rig departed Colombia on 25th  August after finishing its charter with Petrobras and arrived off Aruba on 29th August. Market sources suggest the rig is well placed for an assignment in Latin America, and the gap in work is not expected to be of long duration.

Mobilisation / Upgrades / Technology

Japan Drilling Co. (JDC) semisub Hakuryu-5 completed a one-well exploration drilling job for Inpex off Japan. The rig is underway to Malaysia, where it is scheduled to undertake its next engagement with Petronas offshore Sarawak during September 2022. The contract involves the drilling of four firm wells along with options for six wells, and was secured through JDC’s local agent in Malaysia. 

Jackup Valaris 118 has departed Mexico and is en route to Trinidad and Tobago for its next job. The rig had been working off Mexico for Fieldwood since 2020. Its upcoming assignment off Trinidad and Tobago is with BP and should run for about 8-9 months with three 60-day options available.

Trillion Energy's drilling program at the SASB gas field has been delayed due to additional repairs needed on the jackup GSP Uranus. The GSP Uranus was scheduled to mobilize to the SASB field on August 26 after a thorough inspection by rig inspectors ModuSpec. However, the rig in inspection identified deficiencies with the top drive and ballast tank. The additional repairs are expected to be completed during this week and the jackup will then mobilize.

Sale / Scrap

Seadrill announced today that the company has entered into a Share Purchase Agreement (SPA) with subsidiaries of ADES to sell the legal entities that own and operate seven jackups in Saudi Arabia. The sales agreement includes the five KFELS B Class AOD I, AOD II, AOD III, West Callisto and West Ariel, and the two Baker Marine Pacific Class 375 West Leda and West Cressida. The seven rigs will be sold for a total of USD 628 million in cash (subject to adjustment for working capital and other items, and reimbursement to Seadrill for any project costs spent at the time of closing in relation to the reactivation of the three jackups West Ariel, West Cressida and West Leda).

Other News

Deepwater Abandonment Alternatives (DAA), a wholly owned subsidiary of Helix Energy Solutions Group, has acquired all of MP Gulf of Mexico's (MP GOM) 62.5% interest in Mississippi Canyon Block 734 in the Thunder Hawk field. The asset consists of three wells and related subsea infrastructure. Under the terms of the agreement, Helix receives ownership of the interest, using 1 November 2021 as the effective date for the purchase price adjustment resulting in nominal cash paid by MP GOM at closing, in exchange for the assumption of MP GOM's abandonment obligations for the field. In addition to anticipated future production revenue, DAA will operate the field, with Helix eventually expected to perform the required P&A activities.

KeyFacts Energy Industry Directory: Esgian