Diamond Offshore drillship staying in Gulf of Mexico for two more years

U.S.-headquartered offshore drilling contractor Diamond Offshore Drilling has found more work for one of its drillships with Anadarko Petroleum Corporation, a wholly-owned subsidiary of Occidental (Oxy), prolonging the rig’s drilling assignment in the U.S. Gulf of Mexico.

After securing a one-year contract with a one-year priced option with Anadarko Petroleum Corporation, the Ocean BlackHawk drillship began its drilling campaign in the Gulf of Mexico in the fourth quarter, after the completion of an MPD installation, special periodic survey, and contract preparation work.

According to Diamond Offshore, a two-year contract extension has been executed by Anadarko, which will begin in November 2024 in direct continuation of the rig’s current contract. The extension, representing approximately $350 million of additional backlog excluding any managed pressure drilling services, replaces the one-year priced option from May 2023.

Bernie Wolford, Jr., Diamond Offshore’s President and Chief Executive Officer, commented: “This extension is a testament to the safe performance of our crews and provides further visibility to our earnings and cash flow streams for 2025 and 2026. Combined with our previous awards, this brings our total contract backlog to approximately $2.1 billion.”

Three one-year unpriced options are still at Anadarko’s disposal. Before the latest extension was secured, the U.S. offshore drilling player’s total backlog was $1.9 billion as of April 1, 2024, thanks to $731 million in contract awards in 2024, including $713 million in the first quarter of 2024.

The 2014-built Ocean BlackHawk is an ultra-deepwater drillship from Hyundai Heavy Industries, which comes with dynamic-positioning, dual-activity capability, maximum hook-load capacity of 1,250 tons, two seven-ram blowout preventers, water depth capabilities up to 12,000 feet, and drilling depth capabilities up to 40,000 feet. 

Recently, Diamond Offshore secured the marketing rights for three seventh-generation drillships by sealing a deal with the owner of the West Dorado and West Draco drillships to market the rigs in Brazil, Latin America, West Africa, Malaysia, and Indonesia. The U.S. player also agreed with the owner of the former West Libra, now known as the Tidal Action, to market the rig in the U.S. Gulf of Mexico.