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Consistent with this revised operational objective, BPC, on 24 May 2020, entered into an agreement with Stena DrillMax Ice Limited ("Stena"), a wholly-owned subsidiary of Stena Drilling Limited, one of the world's foremost independent drilling contractors, for the provision of a sixth-generation drilling rig (the "Rig Contract"). The Rig Contract is fully termed, binding and unconditional, and provides the certainty of a firm time slot for the delivery of a drilling rig on location in the window of 15 December 2020 to 1 February 2021.
Highlights
Unconditional agreement with Stena Drilling for the provision of a state of the art, sixth generation drilling rig, including integrated supply of a Managed Pressure Drilling (MPD) unit.
Firm window for commencement of drilling between 15 December 2020 and 1 February 2021, consistent with licence obligations as extended by the Covid-19 force majeure event.
Reduced estimated total cost of Perseverance #1, down by approximately 15%, based on the contracted rig rate and rates for other contracted services and equipment, reflecting changes to the global operating environment.
Perseverance #1 well targeting recoverable P50 oil resources 0.77 billion barrels, with an upside of 1.44 billion barrels. Reduced cost estimate creates scope for expanded formation evaluation work in the success case, without increasing previous estimated total capital requirement.
Optimal funding strategy and timing, including farm-out process, being reassessed accordingly.
Rig Contract
The Rig Contract is in accordance with standard industry documentation, and sets out all relevant commercial parameters and costs - a summary of the key terms and conditions of the Rig Contract is provided in Table 1 below. Establishing a definitive time window for drilling, and agreeing operating parameters with Stena, now allows the BPC drilling team to recommence planning for operations without unnecessary distraction or uncertainty.
The Rig Contract entered into with Stena replaces the previous contract for a drilling rig that the Company anticipated entering into with Seadrill Limited, and provides for improved terms (notably, an all-in rig cost, including managed pressure drilling system, lower than that previously anticipated). The rig to be provided by Stena is of an equivalent or higher specification to that which would have been provided by Seadrill, and thus the Company's existing drilling plan and Environmental Authorisation will, subject to some rig-specific updating, continue to be applicable for Perseverance #1 drilling operations. Over the coming months the Company will be working with The Government of The Bahamas to ensure an update and commensurate extension to the existing authorisation.
Source: Investegate
Valaris Limited announced new contracts awarded subsequent to issuing the Company’s most recent fleet status report on February 21, 2023. Three-year contract with Petrobras for drillship VALARIS DS-8. The rig will be reactivated for this contract. The total contract value is approximately $500 million, including a $30 million mobilization fee. 100-day contract with a TotalEnergies affiliate for drillship VALARIS DS-12. The contract is expected to commence in second quarter 2023. 70-day contract with Beach Energy offshore New Zealand for heavy duty modern jackup VALARIS 107. The contract is expected to commence in third quarter 2023. The total contract value is approximately $26 million. President and Chief Executive Officer Anton Dibowitz said, “We are particularly pleased to have secured the award for preservation stacked drillship VALARIS DS-8, for a contract that is expected to generate a meaningful return over the firm contract term, and we remain focused on exercising our operational leverage in a disciplined manner. This most recent award represents the sixth contract awarded to one of our high-quality stacked floaters since mid-2021, and speaks volumes about our demonstrated track record of project execution when reactivating rigs.” Dibowitz added, “Following the reactivation of VALARIS DS-17 and DS-8, we will have ten floaters working across the golden triangle, including four drillships in Brazil, a market where we expect to see continued growth over the next several years.” Updated Guidance As a result of the contract awarded to VALARIS DS-8, which will require the rig to be reactivated from preservation stack, we are updating our first quarter 2023 and full-year 2023 guidance provided on our fourth quarter 2022 conference call on February 21, 2023. First Quarter 2023 Contract drilling expense is expected to increase by approximately $5 million to $385 million to $395 million. Adjusted EBITDA is expected to decrease by approximately $5 million to negative $5 million to breakeven. Adjusted EBITDAR, which adds back one-time reactivation expense, is expected to be $25 million to $30 million, unchanged from the guidance provided on our fourth quarter 2022 conference call. Full-Year 2023 Revenues are anticipated to be $1.8 billion to $1.9 billion, unchanged from the guidance provided on our fourth quarter 2022 conference call. Contract drilling expense is expected to increase by approximately $60 million to $1.49 billion to $1.59 billion. Adjusted EBITDA is expected to decrease by approximately $60 million to $180 million to $220 million. Adjusted EBITDAR, which adds back one-time reactivation expense, is expected to be $280 million to $320 million, unchanged from the guidance provided on our fourth quarter 2022 conference call. Capital expenditures are expected to increase by $60 million to $320 million to $360 million. Source: Valaris Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here
Seadrill Limited announced that the West Neptune has executed approximately six months of term extensions with LLOG Exploration Offshore, L.L.C in the US Gulf of Mexico. The extensions will commence in direct continuation of the existing term, and will keep the rig busy until Q3 2024, furthering Seadrill and LLOG’s long-term association. Total contract value for the extension is approximately $79 million. Source: Seadrill Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here
Semisub rig owner Dolphin Drilling has inked a new contract with Peak Petroleum in Nigeria for its 1974-built Blackford Dolphin. The firm contract, which follows the letter of award in January, gives the Euronext Growth-listed owner of three rigs the potential to extend the unit’s backlog by a minimum of 120 days and up to 485 days. The deal adds to and will be a direct continuation of the previously announced 12-month contract with General Hydrocarbon Limited (GHL). Øystein Stray Spetalen-backed company said the effective dayrate associated with the minimum firm period of the contract is $325,000, including the mobilisation fee. “The final award of the contract for Blackford Dolphin shows the opportunities in Nigeria at a strong dayrate, in addition to building on the backlog for the rig. It also underlines the attractiveness of our assets, and we look forward to returning to revenue-generating operations in 2023,” noted Bjørnar Iversen, CEO of Dolphin Drilling. Source: Dolphin Join our mailing list here We are #1 on Google and Bing for the "Largest Mobile Energy Network" Come join our community! Download the Rig Lynx app here
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