Bassoe Offshore AS

11/13/2020 | News release | Distributed by Public on 11/13/2020 03:56

Bassoe Analytics weekly rig market round-up (week 46)

Nov 13, 2020

Maersk Drilling was awarded another contract this week, this time securing a one-well deal for its 7th-gen drillship Maersk Viking with Brunei Shell Petroleum. Meanwhile, semisub Atlantic Star and drillship West Capella are now mobilizing for new contracts offshore Brazil and Malaysia, respectively.

In case you missed it, you can access last week's rig market round-up here.

Rig Contracts

Maersk Drilling has secured a contract from Brunei Shell Petroleum Company Sdn. Bhd. (BSP) for the 7th generation drillship Maersk Viking to drill one deepwater exploration well offshore Brunei Darussalam. The contract is expected to commence in March 2021, with an estimated duration of 35 days. The firm contract value is approximately USD 9 million, including additional services provided and a mobilization fee. The contract includes an additional one-well option.

In its third quarter 2020 update, Apache reported that it was nearing award of two rig contracts for its 2021 exploration and appraisal program offshore Suriname. This will be for ultra-deepwater drillships. The company says that it has filed appraisal plans for the Maka and Sapakara discoveries and will submit the Kwaskwasi appraisal plan by year-end. Operations continue on the fourth exploration target, Keskesi, and it has also selected its fifth exploration well, Bonboni, which will be situated in the North Central portion of Block 58. Apache is in the process of transitioning operatorship to Total.

Further to previous Bassoe Analytics reports, Shelf Drilling has now confirmed that Masirah Oil is behind the recent award for jackup Shelf Drilling Tenacious offshore Oman. The rig will commence work under the initial two-well deal next month. Meanwhile, Shelf has also secured a new one-well plus one-well option deal for its jackup Parameswara with Adani offshore India. Work will begin later this month.

Shelf Drilling confirms that another of its jackups, Main Pass IV, has had operations suspended with Saudi Aramco following completion of the ongoing out-of-service project through December 2020. Meanwhile, Eni has suspended operations with its jackup key Singapore and the rig is now on standby in Tunisia. The rig had been scheduled to move to Italy to undertake a new commitment for Eni there, however this has been removed from the rigs schedule. Eni still has a one-year option available to use the rig.

Jackup Shelf Drilling Enterprise is now scheduled to begin work with Chevron Thailand in late December 2020 due to COVID-19 related logistical challenges. This is around two months later than initially planned.

Drilling Activities & Discoveries

ConocoPhillips has made a new gas condensate discovery with its 6507/4-1 (Warka) well in the Norwegian sector, drilled using Transocean harsh-environment semisub Leiv Eiriksson. Preliminary estimates place the size of the discovery between 50 and 190 million barrels of recoverable oil equivalent. Further appraisal will be conducted to determine potential flow rates, the reservoir's ultimate resource recovery and plans for development. The rig will now move to drill wildcat well 6507/5-10 S in production licence 891 in the Norwegian Sea, where ConocoPhillips is the operator.

Ultra-deepwater drillshipStena Forth will commence its one-well exploration drilling campaign with Tullow off Suriname in January next year. The rig is then expected to move to Canada, where it will begin a new campaign for CNOOC International. In direct continuation of this, the drillship will mobilize to Israel to begin a new P&A campaign with Noble Energy, which also has a contract option that could see it drill a well in Cypriot waters using the same rig. The unit is expected to be busy through 2021. Aker BP, operator of production licence PL 127 C, has concluded drilling of the wildcat well 6607/12-4 and appraisal well 6607/12-4 A, targeting the Alve NE prospect. Well 6607/12-4 A encountered oil in three reservoir zones in the Lange Formation, as was the case in wildcat well 6607/12-4. Preliminary estimates of the size of the gas/oil discovery in the Jurassic/Triassic are between 0.5 and 1 million standard cubic metres (Sm³) of recoverable oil equivalent. The oil discovery proven in the Lower Cretaceous is between 1 and 2.7 million standard cubic metres (Sm3) of recoverable oil equivalent within production licence 127 C. The oil discovery may be an extension of the 6608/10/17 S (Cape Vulture) oil and gas discovery from 2017. The wells were drilled by the Deepsea Nordkapp < /a>drilling facility, which will now proceed to production licence 203 in the North Sea to drill production wells on the Alvheim field, where Aker BP is the operator.It is understood that Saipem harsh-environment semisubScarabeo 8 is preparing for its mobilization offshore Norway to commence a new contract with Vår Energi. The campaign is expected to keep the rig busy into the second quarter of 2021.The campaign will include two production and one water injection well at the Goliat Field in the Barents Sea. In addition the King Prince exploration well, near the Balder/Ringhorne field in the North Sea, will be drilled.

Rig Demand

In Indonesia, Premier Oil's farm out agreement between for Zarubezhneft to take a 50% interest in the Tuna discoveries was signed in September. Premier and Zarubezhneft are now in the process of securing Indonesian government approval for the farm out agreement and a one year extension to the Tuna PSC to March 2022. Zarubezhneft will carry Premier for its share of a two-well appraisal program targeted for mid-2021, with the rig procurement process well-advanced.

Premier Oil is targeting new exploration drilling campaigns off Mexico and in the Andaman Sea, Indonesia, during 2022. Premier also plans to drill the stacked Berimbau/Maraca prospect on its operated Block 717 (Premier 50% interest) in Brazil in 2022.

Equinor has, on behalf of the Wisting licence partners, awarded contracts for concept studies to further progress of the project development towards a final concept select decision. Wisting is an oil field in the Barents Sea and a concept selection is planned for the end of 2022. The field is located in the Hoop area of the Barents Sea, around 310 kilometres from the Norwegian mainland and volumes are estimated at 440 million barrels of oil equivalent. It is understood that the operator will require a high-spec semi for development drilling and that the development could require up to 36 wells.

It is understood that Shell is on the look out for a harsh-environment semisub to undertake the drilling of one or two wells at its Ormen Lange field, off Norway. Work is slated to begin in early 2022.

Energean Oil and gas is planning to resume exploration drilling offshore Israel from early 2022. Market sources indicate that the operator is considering around 8 months of work, requiring a deepwater-capable rig for the drill.

Rig Mobilizations

Constellation mid-water semisubAtlantic Star has commenced mobilization offshore Brazil to commence a new three-year deal with Petrobras.

Seadrill ultra-deepwater drillshipWest Capella has started moving offshore Malaysia to commence a new drilling campaign with Petronas. The contract scope covers two firm wells plus a one-well option. The firm term is expected to keep the rig busy until February 2021.

Stena Drilling ultra-deepwater drillship Stena DrillMAX has arrived in Las Palmas, where it will undergo some upgrade yard work. It is understood that the rig is under discussion for a new campaign that could commence in 2021.

Transocean ultra-deepwater drillshipDeepwater Invictus has commenced mobilization from Trinidad to the US Gulf of Mexico where it will continue the next part of its long-term campaign with BHP Billiton. The rig contract runs until at least Q2 2021 with options available thereafter which, if declared, could see the rig committed until 2023.

Newbuilds & Rig Sales

Shelf Drilling has listed four more jackups and one swamp barge as 'held for sale'. These consist of 1982-built Trident 15, 1979-built Randolph Yost, 1978-built Galveston Key, 1983-built Key Hawaii and heavy swamp barge Hibiscus.

Energy Transition

Corvus Energy has been selected by National Oilwell Varco (NOV) to supply the Energy Storage System (ESS) for another PowerBlade™ installation. PowerBlade is an energy storing unit developed by NOV that receives and provides energy based on operational needs on board offshore drilling units. PowerBlade is used in two ways to move towards a cleaner and more efficient future for offshore drilling: energy regeneration and peak shaving, each of which is explored below. The ESS was deployed on Odfjell Drilling semisub Deepsea Atlantic and had estimated savings on an entire project, including the PowerBlade installation, of 6.5 tonnes of diesel, 20 tonnes of CO2, and 300 kg of NOx per day compared to log data prior to the project. 'In light of the impressive results of the first NOV installation on the Deepsea Atlantic, we expect a large increase in offshore drilling rigs using energy storage technology for energy optimization in the future.'

Oil Price

Oil prices increased substantially this week due to positive news that Pfizer and BioNTech said their experimental Covid-19 treatment was more than 90% effective based on initial trial results and doses could be available by December.

Financial

For the third quarter of 2020, Shelf Drilling reported revenues of $127.4 million, a 17.8% sequential decrease compared to Q2 2020. Meanwhile, it reported adjusted EBITDA of $39.3 million, representing an adjusted EBITDA margin of 31% and a net loss of $7.7 million. This is due to a number of drilling contracts which were suspended, terminated or not extended as a result of the COVID-19 pandemic and the subsequent deterioration in oil price.

Pacific Drilling announced that it is commencing solicitation of votes on its proposed prearranged chapter 11 plan of reorganization. On November 10 , the United States Bankruptcy Court for the Southern District of Texas-Houston Division entered an order, among other things, conditionally approving the Disclosure Statement for the First Amended Joint Plan of Reorganization of Pacific Drilling S.A. and its Debtor Affiliates Pursuant to Chapter 11 of the Bankruptcy Code and scheduling a combined hearing on December 21, 2020 to consider (a) final approval of the Disclosure Statement and (b) confirmation of the First Amended Joint Plan of Reorganization of Pacific Drilling S.A. and its Debtor Affiliates Pursuant to Chapter 11 of the Bankruptcy Code. The voting deadline is December 14, 2020.

Other News

Equinor has, on behalf of the partners ExxonMobil and Petrogal Brasil, awarded Baker Hughes, Halliburton and Schlumberger contracts for drilling and well services on the Bacalhau field in Brazil. The total value of the three contracts is estimated at USD 455 million. The contracts have a firm period of 4 years and two 2-year options. The contract scope awarded to Baker Hughes covers drilling services and completion. Halliburton's scope of work will include intervention services and liner hanger, while Schlumberger will deliver wireline services.

Zentech Inc has been awarded the Structural Engineering scope for the conversion of a ex-Borr Drilling jackup Atla to an Offshore Installation for BW Energy. Prior to acquisition, Zentech carried out an engineering study and survey onboard the rig as part of an initial study to identify the feasibility of the Mobile Offshore Drilling Unit (MODU) in the field. Zentech will carry out all structural engineering for the conversion to an Offshore Installation (OI) as per the rules and regulations for ABS Classification Society. This project is expected to be completed by Q1 of 2022.

In connection with planning for future drilling programs at the Etame Marin block offshore Gabon, VAALCO recently agreed to acquire new 3-D seismic data. VAALCO expects the seismic survey to begin and conclude in the fourth quarter of 2020, with processing to be fully completed by the fourth quarter of 2021. The Company expects that the full field 3-D survey will optimize future drilling locations, provide better imaging of existing satellite and infill locations, as well as identify additional upside opportunities.

In Mexico, negotiations between the Block 7 partners and PEMEX regarding the Zama field development plan and the unitization of the Zama field are progressing and are expected to conclude in Q1 2021. FEED on the Zama project scheme (two platforms plus FSO) is reaching a conclusion and pending progress on the unitisation and other approvals a final investment decision would be made later in 2021.

BP Canada Energy Group ULC was the only bidder in the latest Canada-Newfoundland and Labrador Offshore Petroleum Board licensing round. Call for Bids NL20-CFB01 comprised 17 parcels (totaling 4,170,509 ha) in the Eastern Newfoundland Region. BP was awarded Parcel 9 (264,500 ha) after pledging $27 million in work commitments. All the remaining 16 parcels could be re-offered in a future Call for Bids. Subject to BP satisfying requirements specified and receiving government approvals, the board will issue the new exploration license in January 2021.

Get on-demand offshore rig values from Bassoe Rig Values

  • Bassoe Analytics has launched Bassoe Analytics Valuation service, a subscription service which provides users 24/7 offshore rig valuations as well as access to Bassoe Analytics Premium which provides rig market data and analysis platform.
  • Bassoe Analytics Valuation Service provides users with 24/7 valuations on over 800 offshore rigs as well as contractors' fleet values, using a clear valuation methodology including multiple drivers.
  • Bassoe Analytics Premium provides users with continuously updated data and analysis on the offshore rig market including latest transactions and fixtures, contract overview, dayrates, rig sales, utilisation and more. If you would like further details regarding this service, please get in touch with Barry Young.

Did you know that Bassoe Analytics has launched Bassoe Analytics Premium, a subscription service which gives users enhanced access to our offshore rig market data and analysis platform?

Do you have the Bassoe Analytics mobile app?

On the back of the success of the Bassoe Analytics website, we've decided to go mobile. Now you can access our open source offshore rig database when you're on the go. Find out more and download the app from the Google Play or App Store here.

Data: Bassoe Analytics, Image attribution: Maersk Drilling.