Total hires Borr’s jack-up. Demand growing, driller says

Offshore driller Borr Drilling has won a contract for its C20051 jack-up drilling rig with Total. It has also secured a LoI for its Norve rig currently deployed in Gabon.

The company, owning 37 offshore rigs, on Thursday said the jack-up would work for Total in the Netherlands starting September. The rig’s previous contract with Perenco expired this month.

According to Bassoe Analytics, the two-month contract is with Total in the Netherlands starting on September 25, 2018, ending late in November. Total will have an option to extend the contract further for the 1982-built rig.

Also worth noting, Borr’s Norve jack-up which has been used for drilling in Gabon by BW, will this month go on a contract with Perenco for Gabon/Cameroon work until February.

Borr also said that it had secured a letter of intent for the deployment 2013-built Norve with an undisclosed client starting in July 2019 until April 2020.

Borr Drilling currently has 11 rigs either drilling or with a secured contract waiting to start drilling.

Modern Jack-up demand rising

In its quarterly report on Thursday, Borr noted that the jack-up rig utilization was on the rise, also noting an increased number of fixtures and preference for modern rigs.

The company currently has eleven modern-jack-ups under construction in Singapore at PPL Shipyard and Keppel, with delivery dates spread between September 2018 – and December 2020. It also has eleven premium jack-up rigs warm-stacked and available for work. Five of these have been built in 2018 and are warm-stacked in Singapore.

Bassoe Analytics data shows that the jack-up market is currently enjoying the best utilization, compared to drillships and semi-submersible rigs. Jack-ups utilization is at 68 percent, semis at 57 percent, and drillships at 52 percent.

Bassoe, a Norwegian offshore rig broker, on Thursday lifted its outlook for jack-up rig values on the back of the increased number of contracts.

“As a result of higher contracting activity and our outlook for increased demand and dayrates, values for jack-ups have risen by 2% on average over the last 4-8 weeks. We see interest in higher spec, new (premium) jack-ups continuing to build and expect jack-up values to follow a steady upward trend over the next few months,” Bassoe said.

It’s worth noting that Borr Drilling alone sold 17 rigs jack-up drilling rigs for scrap during the second quarter for total proceeds of $35.2 million. More of this is expected to continue in the jack-up space.

“The supply of newbuild rigs entering the market will be more than offset by additional demand and scrapping of older rigs,” Bassoe said.

Offshore Energy Today Staff

Offshore Energy Today Staff