Premier ends contract for ‘Eirik Raude’. Postpones Chatham well

  • Exploration & Production

Premier Oil, an independent oil and gas company, has ended a contract it had with the offshore driller Ocean Rig for the Eirik Raude semi-sub. 

Namely, Premier Oil and Noble Energy entered into a contract with Ocean Rig UDW on June 3, 2014, for the provision of the Eirik Raude semi-submersible drilling unit for an exploration drilling campaign in the Falkland Islands.

Following a number of material operational issues with the Eirik Raude rig during the term of the contract to date, Premier and Noble Energy issued a termination notice to Ocean Rig on February 11, 2016, terminating the contract with immediate effect, Premier said in a statement on Friday.

As a result, Premier will no longer be drilling the Chatham exploration well during the current campaign.

However, the company says it is in discussions with the Falkland Islands Government regarding the possibility of drilling this prospect in the future.

Rockhopper Exploration, a partner in the project, confirmed that, as a result of the drilling contract cancellation, the drilling of the Chatham well – the final well in current campaign – will now be deferred until the Sea Lion pre-development drilling campaign.

Rockhopper added that the postponement of the Chatham well has no impact on the planning or timetable for the Field Development Plan for the Sea Lion initial phase development.

Samuel Moody, Rockhopper CEO, commented: “Whilst it is a shame not to be able to drill Chatham as part of this campaign the resources added at the Zebedee location, along with the potentially very significant discoveries in the Isobel/Elaine area, mean that from a sub surface perspective this has been a hugely successful campaign.”

The termination of the contract did not come as a surprise as Ocean Rig recently received a notice of breach of material obligations from Premier Oil under the drilling contract for the Eirik Raude semi-submersible drilling rig. At the time, Premier stated “there has been no changes to Premier’s drilling programme”. 

Ocean Rig owns two semi-submersible drilling rigs -Eirik Raude and Leiv Eiriksson – in its fleet otherwise made up of drillships.

The offshore driller in October 2015, said that there were few prospects of employment for the two semis, and if no employment is found the rigs will be cold stacked, and either disposed or scrapped.

Offshore Energy Today Staff

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