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Brought to you from Output by Rig Lynx – Offshore driller Transocean has bought a 33.3% interest in the West Rigel, a newbuild harsh environment semi-submersible rig built by a Sembcorp Marine yard for a subsidiary of Seadrill.
The interest has been bought through a joint venture with funds managed and/or advised by Hayfin Capital Management (Hayfin), Transocean said on Wednesday.
Transocean added that the total purchase price for the rig, built by Sembcorp Marine’s Jurong Shipyard, is $500 million. The rig had been ordered at the Jurong yard by a Seadrill’s subsidiary, North Atlantic Drilling Limited (NADL), but never delivered.
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Namely, following several previous delays, Seadrill agreed with Jurong to delay taking delivery of the West Rigel until July 6, 2018, at which point, if NADL had not secured acceptable employment for the rig, it was to be sold into a joint asset holding company with Jurong.
Meanwhile, Jurong was working on a specific third party sale of the rig and, on April 5, 2018, Seadrill entered into a settlement and release agreement with Jurong in respect of the West Rigel whereby Seadrill agreed that the share of sale proceeds from the sale of the West Rigel by Jurong would be $126 million.
Transocean has initially invested $83 million in the joint venture with an additional investment of $83 million to be made at a later date in accordance with the terms of the joint venture arrangements with Hayfin.
Transocean has also invested $8 million for working capital, which includes upgrades and activation cost with additional amounts to be later funded. The rig is expected to be delivered in the fourth quarter of 2018, and available for charter in the first quarter of 2019.
The rig, renamed the Transocean Norge, is a Moss Maritime CS60 design harsh environment semi-submersible and, according to Transocean, is considered to be among the most capable newbuild semi-submersibles in the world.
Transocean noted it possesses the exclusive right to market and operate the Transocean Norge, and will immediately begin engagement with customers.
Transocean’s President and Chief Executive Officer, Jeremy Thigpen, remarked: “Our interest in the Transocean Norge, along with the recent acquisition of Songa Offshore, underscores our commitment to high-grading our fleet in a financially prudent manner to provide our customers with the drilling assets and expertise they seek for projects in harsh environment and ultra-deepwater environments.â€
Thigpen continued: “Given the strong demand and improving utilization and dayrates for this class of rig, we expect to secure work for the Transocean Norge in the near future.â€
When it comes to rig purchases this week, it is worth mentioning that John Fredriksen’s Northern Drilling made a move to buy two newbuild drillships previously owned by Seadrill, an offshore drilling company which is also controlled by Frederiksen.
Offshore Energy Today Staff
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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