Noble Clyde Boudreaux rig - Noble Corp.

Three Noble rigs coming back from warm-stack for new gigs

Offshore drilling contractor Noble Corporation has won several new contracts for its fleet of drilling rigs, which will see three of its units come back from the warm-stack mode.

Noble Clyde Boudreaux rig; Source: Noble Corp.
Noble Sam Turner rig - Noble Corp.
Noble Sam Turner rig; Source: Noble Corp.

According to the rig owner’s latest fleet status report, published on 11 March 2021, the jack-up rig Noble Sam Turner has won a two-year contract award with Total in Denmark from early March 2021 to early March 2023.

The rig was warm-stacked in the UK from September 2020 until early March 2021.

In Guyana, the contract term has been shifted between rigs under the Commercial Enabling Agreement with ExxonMobil.

Under the agreement with ExxonMobil, the drillship Noble Tom Madden will now work off Guyana until mid-December 2027.

Previously, the drillship had been awarded a contract with ExxonMobil, which would have seen it operate for Exxon from mid-February 2024 until mid-August 2030.

The Noble Sam Croft has now been scheduled to operate for ExxonMobil in Guyana from mid-April 2021 until early January 2022.

The previous agreement would have seen the rig operate for ExxonMobil from early February 2021 until early August 2021.

The rig has recently worked for Total and Apache offshore Suriname and it is scheduled to be released.

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Furthermore, the Noble Don Taylor and Noble Bob Douglas drillships will both be working for ExxonMobil until late December 2022.

In Indonesia, the semi-submersible rig Noble Clyde Boudreaux has been awarded a contract with Premier Oil from early July 2021 to early November 2021.

The day rate has not been disclosed. The rig has been warm-stacked in Malaysia since early August 2020.

In Saudi Arabia, the rig owner has agreed on a day rate adjustment with Saudi Aramco for the Noble Scott Marks jack-up rig.

For the period from 1 January 2021 through 31 December 2021, the day rate has been adjusted to $139,000 while drilling for gas and $90,000 while drilling for oil, after which time the day rate is scheduled to return to $159,000. The rig is under this contract until early July 2023.

In addition, the previously issued 12-month suspension notice for the Noble Roger Lewis jack-up has been rescinded by Saudi Aramco and replaced by an approximately six-week standby period for well planning and rig maintenance.

The rig worked until mid-February 2021 when the standby period began.

For the period from 1 January 2021 through 31 December 2021, the day rate has been adjusted to $139,000 while drilling for gas and $90,000 while drilling for oil, after which time the day rate is scheduled to return to $159,000. The contract is now scheduled to end in early March 2022.

Noble Roger Lewis jack-up rig
Noble Roger Lewis jack-up rig; Source: Noble Corp.

Finally, the Noble Tom Prosser jack-up rig has been awarded a contract for an estimated 270 days with Santos in Timor-Leste / Australia. The contract will start in early May 2021 and last until late January 2022.

The jack-up previously operated for ExxonMobil in Australia from January 2020 until November 2020 when it was warm-stacked.

Financial restructuring and tender increase

Noble Corp has recently emerged from Chapter 11 bankruptcy with a renewed balance sheet.

The company has now also released its financial reports for the fourth quarter of 2020 and full-year 2020.

In the report, the company said that, as a result of the financial restructuring, it had emerged with a substantially deleveraged balance sheet with less than $300 million of net debt and liquidity of over $600 million.

Noble’s new capital structure includes a new $675 million revolving credit facility, of which $178 million is currently drawn, and $216 million of second-lien notes.

Also in the report, Noble posted revenues of $203 million for 4Q 2020 compared to $242 million in 3Q 2020.

Contract drilling services revenues for the fourth quarter totaled $195 million compared to $227 million in the third quarter of 2020.

The decrease in revenues was due largely to a lower day rate on the Noble Lloyd Noble and lower operating days on the Noble Tom Prosser and Noble Clyde Boudreaux in the fourth quarter.

Marketed fleet utilization was 70 per cent in the fourth quarter compared to 72 per cent in the third quarter.

Noble’s net loss in the last quarter of 2020 totalled $2.8 billion compared to the loss of $51 million in 3Q 2020.

It is also worth reminding that, during the fourth quarter, the rig owner disposed of five cold-stacked rigs.

As a result, the company’s contract drilling services costs for the fourth quarter were $125 million compared to $137 million in the third quarter of 2020.

The 9 per cent decline from the third quarter was primarily driven by the disposition of the five cold-stacked rigs, and lower expenses on rigs that were idle during the fourth quarter.

Commenting on the state of the offshore drilling industry, Robert W. Eifler, President and Chief Executive Officer of Noble Corporation, stated: “While our industry continues to face significant challenges, we are starting to see an increase in tender activity in various markets and expect further improvements to the extent operators remain confident in forward oil and gas prices”.