In case you missed it, you can access last week's Rig Market Round-Up here.
Maersk Drilling has been awarded a one-well contract from OMV (Norge) AS for jackup Maersk Integrator. In direct continuation of its previously announced work scope, the rig will drill one exploration well in the Ommadawn prospect in PL 970 offshore Norway. The contract is expected to commence in mid-2021, with an estimated duration of 52 days. The firm contract value is approximately USD 14.3 million, including mobilization, but excluding integrated services provided and potential performance bonuses. The contract further includes an option to add approximately 28 days of well testing. The rig is currently undergoing a series of upgrades to combine the use of hybrid power with low levels of NOx emissions, adding data intelligence to further reduce energy consumption and CO2 emissions. The performance bonus schemes included in the contract with OMV are based on rewarding reduced fuel consumption and reduced NOx emissions during the drilling operations.
Shelf Drilling has secured an extension for its jackup Rig 141 with Gempetco offshore Egypt for 45 days. The rig is now committed under the contract until at least mid-January next year.
Drilling Activities & Discoveries
Petronas has made its first discovery offshore Suriname with its Sloanea-1 exploration well located in Block 52, drilled using semisub Maersk Developer. Petronas stated: ‚the well encountered several hydrocarbon-bearing sandstone packages with good reservoir qualities in the Campanian section. The well data proves excellent calibration of the hydrocarbon potential of the block.‘ Further evaluation is being undertaken to determine the full extent of the discovery. The rig will now prepare for its next contract off Suriname, which will be with Total in Block 58, starting early next year.
Shelf Drilling jackup Baltic is now expected to resume operations offshore Nigeria with Total next month. Operations were suspended during early July 2020. Meanwhile, jackup Trident VIII is expected to complete its contract with Unitech Nigeria in around 10 day's time.
Equinor has finished drilling the 34/7–37 S wildcat targeting the 7-Fjell prospect in production licence 089, off the coast of Norway, using Odfjell Drilling semisub Deepsea Atlantic. The well, which was drilled 200km north-west of Bergen and 4km west of the Tordis field, was reported to be dry.
Medco Energi has confirmed a new discovery after drilling its West Belut-1 appraisal well in the West Natuna area, offshore Indonesia, using Vantage Drilling jackup Soehanah (Pearl Driller). The operator says that it will continue a post drill evaluation and that this was the final well of its 2020 drilling campaign.
Lundin has been given approval from the Norwegian authorities to drill the 16/4–12 wildcat well targeting the Merckx prospect using harsh-environment semisub West Bollsta. Operations are expected to take around 32 days to complete. The rig is committed to Lundin until at least Q2 2022. Meanwhile, the same operator has also been granted consent to re-commence drilling operations at the Norwegian Edvard Greig field in PL 338 using jackup Valaris JU-290 (previously named Rowan Viking). Drilling will take around 265 days and will begin in January.
Equinor is seeking consent from the Norwegian authorities to drill the 31/11–1S exploration well targeting the Stovegolvet prospect in PL785 S using harsh-environment semisub Deepsea Atlantic. Operations will begin in Q1 2021.
Seadrill harsh-environment semisub West Hercules has arrived at its next well location for Equinor off Norway, and has spudded the 31/2–22 S wildcat well targeting the Blasto prospect in PL 090. The rig is committed to Equinor until at least mid-2021.
Ultra-deepwater drillship Noble Don Taylor has mobilized to its next drill site, Hassa-1, within the Stabroek Block off Guyana for ExxonMobil. The rig is committed to the operator on a long-term agreement.
Africa Energy has issued drill stem test results for the recent Total-operated ultra-deepwater Luiperd-1X discovery on block 11B/12B offshore South Africa. According to Jan Maier, the company’s VP or Exploration, the well, drilled by harsh-environment semisub Deepsea Stavanger in 1,800m of water, intersected 85m gross sands of which 73m was net good-quality pay in the main target interval, and also thicker than expected.
Bahamas Petroleum says that an application has been made to the Supreme Court of The Bahamas by environmental activists for judicial review of the decision taken by the Government of The Bahamas in February 2020 to grant Environmental Authorisation for BPC's Perseverance #1 well, which is expected to spud imminently using ultra-deepwater drillship Stena IceMAX. The company stated that ‚BPC believes the application to be without legal basis or merit and considers that there should be no legal impediment to proceeding with the drilling of the Perseverance #1 well‘.
Harsh-environment semisub Deepsea Stavanger has started mobilizing from South Africa back to Norway, following conclusion of its drilling campaign with Total. The rig has a new campaign lined up next year with Aker BP consisting of five wells, lasting for around 150 days.
This week, jackup Well-Safe Protector arrived in Invergordon, UK, from Norway where it will continue to undergo preparations to enable it to undertake plug and abandonment work in the future. To remind, the 1993-built rig (previously named West Epsilon) was purchased from Seadrill earlier this year.
VAALCO is planning to begin its next drilling campaign at its Etame field, off Gabon, in late 2021 or early 2022. The operator has previously used jackups to drill at the field.
NAM and licence partners are planning to drill the F5-A exploration well offshore the Netherlands in late 2021 or early 2022, depending on industry conditions at the time. A jackup will be required for the drill.
Anasuria Hibiscus says that it is planning to sanction its Marigold development in the UK North Sea around March next year. Market sources indicate that the operator is shortly planning to tender for a semisub for a three-well plus one-well option campaign starting in late 2021 or early 2022.
Oil and Gas UK says that it has identified 1,616 candidate wells in the North Sea that are in line for decommissioning over the next decade, accounting for 49% of the UK’s decommissioning costs, with the projected total cost revised upwards to £7.4 billion from £6.8 billion in the 2019 report.
Corallian Energy says that it plans to submit a development plan by the end of next year for development of the Victory gas field in the west of Shetland area off the UK. The field will likely be developed via a single-well 18-km subsea tieback to the HTT2 ‘T’ structure in Total’s Laggan to Sullom Voe pipeline, with potentially an umbilical connection to the Edradour subsea facilities.
Newbuilds & Rig Sales
Awilco Drilling PLC announced that its wholly owned subsidiary Awilco Rig 2 Pte. Ltd. (AR2) received a notice from Keppel FELS purporting to terminate the Vessel Construction Contract for harsh-environment semisub Nordic Spring. Keppel FELS has also served AR2 with a notice of arbitration. This follows a letter from AR2 to Keppel FELS raising concerns about the status of the project. AR2 vigorously denies the allegations by Keppel FELS in the Notice and considers the vessel construction contract to be intact. Nordic Spring is a semisubmersible drilling rig of Moss Maritime CS60 Eco MW design ordered by Awilco Drilling’s subsidiary from Keppel FELS. In addition, a separate Awilco Drilling subsidiary has an option for one further rig of the same design. To remind, this is the second semisub construction contract that Awilco has now been terminated with Keppel FELS, the first was for Moss Maritime CS60 Eco MW design Nordic Winter.
On Thursday, Brent crude futures reached $49.08 a barrel and US West Texas Intermediate crude futures hit $45.77 a barrel. Prices were buoyed by the Coronavirus vaccine rollout in the UK and the news of an imminent approval of a vaccine in the US, which could help increase future fuel demand. On Thursday, Brent Crude climbed above $50 per barrel for the first time since the oil price crashed in March 2020.
Other Industry News
The Trump administration says that it will issue a sale notice for oil leases in the Arctic National Wildlife Refuge (ANWR), enabling it to hold a drilling auction in the ecologically sensitive area before President-elect Joe Biden takes office.
Danish drilling contractor Maersk Drilling on Wednesday said its Board of Directors had appointed Christine Morris as the new Chief Financial Officer and member of the Executive Management with effect from January 5, 2021.
Neptune Energy has announced a feasibility study into plans for a large-scale offshore Carbon Capture and Storage (CCS) project in the Dutch North Sea, with the potential to safely store 120–150 million tonnes of CO2. Neptune will conduct the study in cooperation with its licence partners and CO2 emitters. The study will assess the feasibility of injecting between 5 and 8 million tonnes of CO2 annually into the depleted gas fields around the Neptune-operated L10-A, L10-B and L10-E areas. If the project is developed, it will be one of the largest CCS facilities in the Dutch North Sea and could meet more than 50% of the CO2 reduction being targeted by the Dutch industrial sector. Neptune already has experience with CCS, having carried out a 14-year project on its K12-B platform offshore the Netherlands, re-injecting CO2 into the gas field. The project was carried out in partnership with TNO, the Netherlands Organisation for applied scientific research.
Aker BP has received approval from the Norwegian authorities to proceed with the Hod Redevelopment project in the southern Norwegian North Sea. Hod is one of the first projects to be realized during the temporary changes in Norwegian petroleum taxation that the Storting approved in June. The field will be developed with a normally unmanned wellhead platform with 12 well slots, Hod B, tied-back to and remotely controlled from the Valhall field center. According to Aker BP, Hod will have low CO2 emissions due to power from shore. Production is expected to start in 1Q 2022 and last until 2049. Recoverable reserves are estimated at 40 MMboe. The investment estimate is NOK 5.7 billion ($650 million). The plan is to drill five wells with side-tracks to increase the recovery factor.
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Data: Bassoe Analytics, Image attribution: Maersk Drilling.