Borr securing more work for newer jackups

Borr Drilling has issued an update on the status of its jackup fleet.

Offshore staff

HAMILTON, BermudaBorr Drilling has issued an update on the status of its jackup fleet.

In late January, the company took delivery ofNjord, the ninth and final premium newbuild jackup from PPL Shipyard.

Borr has contracts for delivery of eight more rigs from yards before 4Q 2020. When all have been delivered, its fleet will comprise 36 rigs, of which 29 are in the ‘premium’ category, with 27 built after 2010.

One of its premium rigs,Prospector 5, has a letter of intent for a 180-day assignment in the North Sea, which is due to begin next month following a short yard stay.

Another,Prospector 1, started a five-month contract in December for Tulip Oil in the Dutch North Sea.

Also, in the Dutch sector, Total exercised options to keep the standard jackupC20051 until this month. Borr is in discussions with customers regarding future work prospects for the rig, but it may also opt for a divestment.

The semisubmersibleMSS1 is on contract to TAQA until November, with talks under way on extension options.

Premium jackupsGerd and Natt are due to begin two-year contracts off Nigeria soon with Exxon and First E&P, respectively. Another rig in this category, Groa, is set to mobilize to Nigeria for a two-year contract with ExxonMobil, which should start in April.

The recently reactivated premium jackupOdin has a contract offshore Mexico, while the Ran is undergoing reactivation activities ahead of an 11-month contract for Spirit Energy in the North Sea, likely to start next month.

According to Borr, take-up of the global competitive jackup fleet was at 78% at the end of December, two percentage points higher than in the previous quarter.

Use of modern jackups (constructed after 2000) was at the 81% mark at year-end, a 3% increase on 3Q 2018.

In some regions such as the North Sea, Middle East and West Africa, competitive usage is above 90%, the company claimed, and this is driving pricing higher.

At the same time, the company, along with other NOCs in Qatar and Malaysia, has introduced a restrictive age limit, effectively barring selection of jackups built before 2010.

Other requirements such as BOP capabilities, cantilever reach, crane capacity and water depth, further limits the availability of suitable rigs for bidding.

During 4Q 2018, seven rigs were retired from the worldwide jackup fleet, bringing the total retired for the year as a whole to 41 – higher than the attrition in 2016 and 2017 combined.

Borr believes a large percentage of the 90-odd jackups that are more than 30 years old and which remain uncontracted are unlikely to return to the active fleet in the near future, or even at all.

03/08/2019

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