Shelf Drilling CEO: Jack‐up rig market improving

Offshore drilling firm Shelf Drilling posted a reduced net loss for the first quarter of the year and is confident of securing further contracts ahead as the drilling industry recovers.

The company which recently added four new China-built jack-ups to its fleet reported a net loss attributable to common shares of $13,6 million for the quarter, which is an improvement compared to a loss of $43 million in the first quarter of 2018. Revenue for the 1Q 2019 was $147 million in line last year’s first quarter.

David Mullen, Chief Executive Officer, said: “The recent closing of our transaction with China Merchants in May 2019 to add four premium newbuild jack‐ups to our fleet further strengthens our competitive position at a time we are seeing indications across our markets of significant improvement for jack‐up drilling services.

“Since the beginning of 2019, we have also secured new contracts or extensions on existing contracts for 8 rig years. We are in advanced discussions on a number of opportunities for the newbuild rigs and are confident that our strong customer relationships, proven operating track record and leading position in key geographies position Shelf Drilling very well to secure further contracts as the offshore drilling industry recovers.”

Shelf Drilling has $876 million in contract backlog at March 31, 2019, across 26 contracted rigs.

During the first quarter, the Company sold the Key Gibraltar and Adriatic X with a combined carrying value of $2.7 million for total net proceeds of $5.6 million and recognized a gain of $2.9 million.

On March 25, 2019, Shelf entered into agreements with a third party to sell the two stacked rigs (the Comet and Rig 124) for a total aggregate selling price of $3.1 million. The transaction is expected to close in Q3 2019. As of March 31, 2019, Shelf Drilling’s fleet consisted of 33 marketable rigs and 4 stacked rigs.

Offshore Energy Today Staff

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