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Valaris Limited announced that the Valaris Group has successfully completed its financial restructuring and emerged from chapter 11. The Valaris Group's Plan of Reorganization (the "Plan") was approved and confirmed by the United States Bankruptcy Court for the Southern District of Texas on March 3, 2021. Valaris now moves forward with a strengthened capital structure, eliminating $7.1 billion of debt and securing a $520 million capital injection by issuing $550 million of new secured notes maturing in 2028. As of April 30, 2021, Valaris had $615 million of available cash, $40 million of restricted cash and $550 million of debt.
"Today marks an important milestone as the Company emerges from chapter 11 with a significantly strengthened capital structure. The overwhelming support of our noteholders, bank lenders and voting shareholders has been invaluable. I want to thank everyone for their continued confidence in our business," said Tom Burke, President and Chief Executive Officer of Valaris. "The last 12 months have been challenging from many perspectives. However, I am immensely proud of our employees' hard work and commitment over this period. Our offshore crews and shore-based staff remain focused on delivering safe, efficient and reliable drilling services to our customers."
Burke continued, "In the current commodity price environment, we are beginning to see the early signs of a recovery in customer demand following the downturn caused by the COVID-19 pandemic. With the elimination of more than $7 billion of debt and an injection of significant additional capital, Valaris is best positioned to take advantage of opportunities going forward."
The Valaris Group emerges with the largest fleet of modern, high-specification assets in the industry. The Company's 11 drillships, five semisubmersibles and 44 jackups are capable of meeting a broad spectrum of customers' requirements across all geographies.
The common stock and warrants of the new parent Company of the Valaris Group will commence trading on the New York Stock Exchange under the ticker symbols VAL and VAL WS, respectively, at market open today, Monday, May 3, 2021. Shares of Valaris plc (the former UK parent company) ("Old Valaris") ceased trading on the OTC Pink Marketplace as of April 28, 2021.
Fleet Status Update Highlights:
Contracts Awards, Extensions, Cancellations and Modifications
VALARIS DS-15 (Renaissance) awarded a contract with Total offshore Brazil with an expected duration of 400 days from June 2021 to August 2022
VALARIS DS-18 (Relentless) contract with Chevron in the U.S. Gulf of Mexico extended by approximately 320 days from March 2021 to January 2022
VALARIS DS-12 contract with BP offshore Angola extended by approximately 100 days from September 2021 to December 2021
VALARIS DS-10 contract with Shell offshore Nigeria extended by approximately 90 days from March 2021 to June 2021
VALARIS MS-1 awarded a contract with Santos offshore Australia with an expected duration of 450 days from May 2022 to July 2023
VALARIS 8505 contract with Eni offshore Mexico extended by approximately 80 days from October 2021 to December 2021
VALARIS JU-121 awarded a contract with Harbour Energy in the North Sea with an expected duration of two years from July 2021 to July 2023
VALARIS JU-247 (Gorilla V) awarded a contract with DNO in the North Sea with an expected duration of 400 days from May 2021 to June 2022
VALARIS JU-249 (Gorilla VII) awarded a contract with OMV offshore New Zealand with an expected duration of 400 days from December 2021 to January 2023
VALARIS JU-67 contract with Pertamina offshore Indonesia extended by approximately 400 days from May 2020 to June 2021
VALARIS JU-120 contract with Harbour Energy in the North Sea extended by one year from July 2022 to July 2023
VALARIS JU-291 (Stavanger) contract with Equinor offshore Norway extended by approximately 280 days from January 2021 to October 2021
VALARIS JU-115 awarded a contract with Mubadala offshore Thailand with an expected duration of approximately 240 days from February 2021 to September 2021
VALARIS JU-122 contract with Shell in the North Sea extended by approximately 205 days from July 2021 to February 2022
VALARIS JU-292 (Norway) contract with ConocoPhillips offshore Norway extended by approximately 90 days from June 2021 to September 2021
VALARIS JU-290 (Viking) awarded a contract with Spirit Energy offshore Norway with an expected duration of approximately 30 days from November 2021 to December 2021
VALARIS DS-7 contract for operations offshore Senegal/Mauritania from September 2020 to August 2021 has been terminated
VALARIS DPS-1 contract, which was scheduled to be completed in early September 2021 was early terminated and ended in September 2020
VALARIS JU-117 (Ralph Coffman) expected to be on a standby rate from January 2021 to September 2021
VALARIS JU-107 contract for operations offshore Australia, previously expected to commence May 2020, now expected to begin May 2021
Mad Dog expected to be on a standby rate from April 2020 to October 2021, before returning to operating day rate until end of contract
ARO Owned Rigs
ARO 2001, ARO 2003, ARO 3001, ARO 3002 and ARO 4001 each awarded five-year contract extensions with Saudi Aramco offshore Saudi Arabia from 1Q21 to 1Q26
Rig Sales
VALARIS DS-3, VALARIS DS-5, and VALARIS DS-6 have been sold and retired from the offshore drilling fleet
VALARIS 5004, VALARIS 8500, VALARIS 8501, VALARIS 8502, and VALARIS 8504 have been sold and retired from the offshore drilling fleet
VALARIS JU-71, VALARIS JU-84, VALARIS JU-87, VALARIS JU-88, VALARIS JU-101, and VALARIS JU-105 have been sold and retired from the offshore drilling fleet
Source: Valaris
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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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