Shelf Drilling secures Chevron gig for former Maersk rig

Offshore drilling contractor Shelf Drilling has secured a contract for its recently acquired high-specification jack-up rig, Shelf Drilling Enterprise, with Chevron for operations in the Gulf of Thailand.

Shelf Drilling Enterprise, formerly known as Maersk Completer
Shelf Drilling Enterprise, formerly known as Maersk Completer

Shelf Drilling entered into a deal to buy the the Maersk Completer rig from Maersk Drilling for $38 million in cash in December last year. The purchase and acceptance of the jack-up rig was completed earlier in January after which Shelf renamed the rig Shelf Drilling Enterprise.

In an update on Tuesday, Shelf said that the new contract is expected to start in August 2020 and run through April 2022 with an option to extend. The contract value for the firm period, including mobilization revenue, is $59 million.

Including the purchase price, subsequent reactivation and contract-specific upgrades, the estimated all-in delivered cost of the rig is $81 million.

Shelf Drilling plans to initially fund the acquisition and deployment of the Shelf Drilling Enterprise by drawing on its revolving credit facility and cash on hand and expects to opportunistically access long term debt financing to replenish liquidity.

David Mullen, Chief Executive Officer, Shelf Drilling, said: “We are excited to further expand our business with Chevron and operations in the Gulf of Thailand.”

Mullen added: “We believe our latest rig acquisition and underlying contract demonstrate our disciplined approach to capital spending and our focus on generating returns for our investors.”

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