All FOE rigs to be out of action soon?

Fred. Olsen Energy’s entire offshore rig fleet will be out of action soon once its last working rig comes off contract next month. 

The offshore fleet of Fred. Olsen Energy with subsidiaries consists of three ultra-deepwater/deepwater units and four harsh environment mid-water semi-submersible drilling units.

According to the company’s 3Q 2017 report on Wednesday, the Bideford Dolphin rig during the quarter continued operations under a drilling contract for Statoil. However, the contract is estimated to be completed in early November. Upon completion of the contract, the unit will be smart stacked in Flekkefjord, Norway.

Borgland Dolphin is smart stacked in Lyngdal, Norway while Bredford Dolphin is preserved and maintained in Kvinesdal, Norway.

Furthermore, Blackford Dolphin and Byford Dolphin are smart-stacked in Flekkefjord and Lyngdal, respectively.

On an international level, the ultra-deepwater drillship Bolette Dolphin completed drilling under its original four-year drilling contract with Anadarko Petroleum Corporation in July after the contract was terminated for convenience. The unit is currently warm-stacked outside Tenerife.

Finally, Belford Dolphin is preserved and maintained in Labuan, Malaysia.

The company has introduced smart-stacking in order to preserve the units ready for new contracts. Smart-stacked rigs are preserved, maintained, kept warm by regular integrated system testing and Class Renewal Survey (CRS) investments will be postponed.

More red ink

The driller on Wednesday posted a net loss of $45.7 million for the third quarter 2017, compared to a $33.9 million loss in the third quarter of 2016.

During the third quarter of 2017 FOE’s revenues dropped to $76.3 million from $213.6 million in the same period last year.

Revenues from the offshore drilling division during the third quarter 2017 were $71.1 million, an increase of $19.5 million sequentially. The company explained that this increase was mainly due to full operational quarter for Bideford Dolphin and the settlement of $14 million related to Bredford Dolphin including $1.6 million booked as interest income.

Looking at a global market for the floater units, FOE said the situation is turning in 2017 and longer-term indicators are positive. The company also sees strong increase in requests and contract activity in the North Sea market and expects a high number of new development projects to be sanctioned in Norway from 2017 into 2019.

Contract awards in the UDW market have also seen an increase during 2017 and the pressure on dayrates is expected to be reduced. However, the contract durations will predominantly be of shorter-term nature albeit with some multi-year contract awards expected to materialize.

The driller sees continued increase in activity in the Norwegian as well as the UK floater market. In Norway, there has been an increase in the number of requests and tenders through 2017, both for shorter and longer term work. In the UK, new contract awards are taking place and further awards are expected for work in 2018, but with some contracts also extending into 2019.

Offshore Energy Today Staff