Valaris adds over $1 billion to drilling contracts backlog

Jan. 10, 2024
Valaris has won new contracts and term extensions for its global drilling fleet with a combined value of about $1.14 billion.

Offshore staff

HAMILTON, Bermuda — Valaris has won new contracts and term extensions for its global drilling fleet with a combined value of about $1.14 billion. That figure excludes mobilization fees and other capital reimbursements.

President and CEO Anton Dibowitz said day rates continue to climb for drillships and also for jackups in the North Sea, with improved prices for fixtures starting in 2025.

The latest awards include a previously announced 1,064-day contract from Petrobras for the VALARIS DS-4 drillship offshore Brazil, valued at about $519 million and due to start late in the fourth quarter, following completion of the vessel’s present contract with the same client this September.

It will then undergo a 90-day program of upgrades as stipulated by Petrobras before resuming operations.

Another drillship, VALARIS DS-16, now has a two-year extension to a contract in the US Gulf of Mexico from Occidental subsidiary Anadarko Petroleum, starting in June in direct continuation of the rig’s existing program. An additional day rate will take effect when operations call for use of managed pressure drilling (MPD) services.

Late last year, Valaris reactivated the previously stacked VALARIS DS-17 drillship for a new long-term contract that started recently offshore Brazil.

In addition, Equinor has exercised a 60-day priced option offshore Brazil for the VALARIS DS-17, likely to start in March 2025 in direct continuation of the existing contract, and at a day rate of about $447,000 including MPD and additional services.

At the end of 2023, the VALARIS DS-8 drillship started a previously announced three-year contract with Petrobras offshore Brazil.

As for heavy-duty harsh environment jackups, Harbour Energy has confirmed a three-year contract extension in the UK North Sea for the VALARIS 120, due to start in third-quarter 2025. 

In the same sector, TotalEnergies has booked VALARIS Stavanger for a 330-day program that should begin in March, with a total value of $48 million including minor rig modifications.

Shell has taken up two one-well priced options in the UK for the VALARIS 121 that should start this summer, with an estimated duration of 406 days, in direct continuation of the rig’s existing program. Total value of the options is close to $55 million.

Ithaca Energy has secured the VALARIS 123 on a one-well contract starting in April with an estimated duration of 45-72 days and a minimum value of $6.3 million.

Eni has reserved the VALARIS 247 for a further single-well job that should begin this summer, after the rig finishes its current program with another operator. The agreed rate is $180,000/d with a minimum duration of 45 days.

Offshore Trinidad, an unnamed operator has accepted a one-well option for the heavy-duty ultra-harsh environment jackup VALARIS 249 at $137,500/d, extending the contract’s firm term by a minimum of 35 days.

Another undisclosed offshore Trinidad operator has agreed to a 300-day term for the VALARIS 249 at $162,500/d, and it is likely to start during the fourth quarter.

However, the same operator has terminated a previously disclosed one-well contract for the VALARIS 107 jackup offshore Australia that was due to start in the current quarter.