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This week Island Drilling signed a contract for work offshore UK, while Transocean's newbuild deepwater Atlas commenced its contract with Beacon Offshore in the US Gulf of Mexico. Meanwhile, additional discoveries are made in Guyana and Suriname.

In case you missed it, you can access our previous Rig Market Round-Up here.


Island Drilling Company has signed a contract for drilling with Dana Petroleum (E&P) Limited, fixing semisubmersible Island Innovator to a work program in UK waters beginning in April 2023. The total contract value is estimated at USD30 million, including associated services. The contract covers three firm wells and one optional well, with the firm work estimated to take 80 days and the optional well another 30 days. The Island Innovator previously worked for Dana Petroleum offshore the UK in the second quarter of 2022. The rig is currently working offshore South Africa.

Chinese drilling contractor COSL announced that the company has signed several long-term drilling rig service contracts with a “first-class international oil company” in the Middle East worth approximately RMB 14 billion (approximately USD 1.9 billion). COLS did not specify how many rigs or which rigs that were covered by the contracts.

BW Energy plans to spud its first production well at the Hibiscus / Ruche development project offshore Gabon in January 2023. BW Energy initial plans are to drill up to six horizontal production wells with first oil from the Hibiscus / Ruche development planned towards the end of the first quarter of 2023. The development is on the Dussafu Marin licence. The wells are to be drilled with Borr Drilling 400-ft jackup Norve, which has been working offshore Gabon for Vaalco since late 2021 with work expected to conclude in the near future. The rig’s upcoming contract with BW Energy keeps the rig working into mid-2023.

Transocean’s 12,000-ft drillship Deepwater Atlas has begun work with Beacon Offshore Energy in the US Gulf of Mexico, marking the rig’s maiden contract following its delivery from Jurong Shipyard in Singapore in June 2022. Deepwater Atlas has started work as part of the first phase of Beacon Offshore’s Shenandoah program. During this initial 255-day program, Deepwater Atlas is using dual BOPs rated to 15,000 psi. Upon completion of this first phase, Deepwater Atlas will have a 20,000 psi BOP installed over the course of 45 to 60 days. It will then return to work with Beacon Offshore Energy and carry out the well completion program. This is slated to last around 275 days. Deepwater Atlas’ contract with Beacon Offshore Energy is valued at USD 252 million, including a USD 30 million mobilization fee. Sister rig Deepwater Titan is scheduled for delivery in early 2023 and will be delivered with a 20,000 psi BOP.

Drilling Activity

Equinor has concluded drilling of exploration well 6607/12-5 in the Norwegian Sea. The well encountered reservoir rocks of about 200 feet (67 meters) thickness in the Cromer Knoll Group, consisting of sandstones with interbedded silt- and claystones with poor to no reservoir quality. The wildcat well was drilled by harsh environment semisub Deepsea Stavanger in a water depth of 1,110 feet (370 meters). The well is classified as dry, with traces of gas, and has been permanently plugged and abandoned.

ExxonMobil and partners have made an additional two discoveries offshore Guyana. The discoveries are the eight and ninth in 2022 and adds to the block’s gross discovered recoverable resource estimate of approximately 11 billion boe. The discoveries were at the Yarrow-1 and Sailfin-1 on the Stabroek Block. The exploration well Yarrow-1 encountered approx. 75 feet (23 meters) of high quality oil bearing sandstone reservoirs and was drilled in 3,560 feet (1,085 meters) of water. The exploration well Sailfin-1 encountered approx. 312 (95 meters) of high quality hydrocarbon bearing sandstone reservoirs and was drilled in 4,616 feet (1,407 meters) of water. A third well, Banjo-1, was also drilled in Q3 2022 but did not encounter commercial quantities of hydrocarbons.

Shell has encountered oil pay at the Zanderij-1 well on Block 42 offshore Suriname, according to partner Hess. Hess stated that the well demonstrated a working petroleum system. Well results are being evaluated and further exploration activities are under consideration. The well was drilled with Noble 12,000-ft drillship Maersk Voyager.

The Norwegian Petroleum Directorate (NPD) has granted Neptune Energy a drilling permit for exploration well 6407/8-8 S in PL 938 in the Norwegian Sea. The wildcat well will be drilled by Odfjell Drilling’s harsh-environment semisub Deepsea Yantai in water depth of 813 feet (271 meters).

Mobilisation and Rig Moves

The Pensacola well is to be drilled with Noble 350-ft jackup Maersk Resilient, which is expected to mobilise to the location in early November 2022. Maersk Resilient was contracted in June 2022, prior to the merger between Noble Corp. and Maersk Drilling. Pensacola is a Zechstein Reef prospect located northwest of the Breagh gas field in the Southern North Sea. Shell’s partner Deltic Energy estimates the prospect to contain gross P50 Prospective Resources of 309 BCF.

Stena Drilling 10,000-ft drillship Stena DrillMAX has returned to work for ExxonMobil offshore Guyana, following the first phase of its SPS conducted in Trinidad and Tobago. The rig moved to Trinidad for surveys in mid-October 2022. Stena DrillMAX is committed to ExxonMobil offshore Guyana into mid-2023 with further options available.

Other News

The federal government of Somalia has approved seven production sharing agreements (PSAs) with Coastline Exploration Limited, clearing the way for Coastline to move forward with an exploration programme on deepwater blocks offshore Somalia. The PSAs were signed in February 2022 and were then subject to review by the federal government of Somalia. Coastline stated that it has paid a USD7 million signature bonus to the Somali Central Bank in line with the terms of the PSAs.

Replacing a previously proposed combination announced in April 2022, Sembcorp Marine and Keppel Corporation have entered into an amended framework agreement under which Sembcorp Marine will directly acquire 100% of Keppel Offshore & Marine from Keppel. Sembcorp Marine will retain its listing on the Singapore Exchange and Keppel O&M will be a wholly owned subsidiary. The exchange ratio between Sembcorp Marine and Keppel is revised from 44:56 to 46:54, meaning Sembcorp Marine shareholders will own 46% of the enlarged company. Under the revised terms, Sembcorp Marine’s acquisition consideration for Keppel O&M is down from the S$4.87 billion announced in April 2022 to S$4.50 billion. The companies cited the uncertain macroeconomic environment as a reason for the combination to be completed as soon as possible and are targeting completion of the acquisition by the end of 2022.

Jadestone Energy and OMV has mutually agreed to terminate the sale and purchase agreement to acquire an operated 69% interest in the Maari Project, offshore New Zealand. In 2019,OMV agreed to divest its 69% interest and operatorship in the Maari Field to Jadestone. However, following legislative changes to New Zealand’s upstream regulatory framework at the end of 2021, there has been a lack of progress on regulatory approvals and uncertainty over the timing of this approval for the transfer of interest and operatorship of the Maari Project. In result, Jadestone and OMV have now reluctantly reached a decision to terminate the transaction.

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