Report: Drilling campaigns get underway offshore Namibia

Dec. 16, 2022
Three floating rigs should be working by next summer, says Evercore ISI.

Offshore staff

NEW YORK CITY A number of drilling campaigns will soon get underway off Namibia as the south African nation seeks to move forward with the development of its offshore energy resources, according to Evercore ISI’s latest Offshore Rig Market Snapshot.

The firm noted that Shell has kicked off its new three-well exploration campaign in Namibia this week, with the Deepsea Bollsta spudding the Jonker-1 wildcat about 18 km from the Graff-1 discovery. Idled offshore Norway since March, the sixth-generation semisubmersible commenced a one-year $124 million or $340,000/day contract with a six-month option that could keep it busy to mid-June 2024. Evercore also noted that a second floater is expected to be on rate offshore Namibia by mid-February, with the Tungsten Explorer mobilizing from the Eastern Mediterranean for a two-well appraisal program at TotalEnergies’ Venus discovery. The 225-day contract is reportedly valued at $79 million, or $351,000/day. Unexercised options could keep the seventh-generation drillship contracted out to February 2026. According to the report, Total contracted a second rig for Namibia this week and will mobilize the warm-stacked Deepsea Mira from Norway for a 300-day exploration and appraisal campaign at Venus in 2Q 2023. The new $135 million contract implies an average dayrate of $450,000/day for the sixth-generation semisubmersible but likely includes reimbursement for mobilization and reactivation which Odfjell Drilling pegged at $45 million.

All three floaters should be on rate through next summer and into the fall, with options potentially keeping Namibia’s floater count at a record three units through 1Q 2024.

Evercore also noted that S&P Global is tracking a probable (>50% probability of proceeding in the indicated timeframe) development tender from Total for Namibia commencing in mid-2024, as well as four possible (<50% probability) exploration tenders from Eco Atlantic and ExxonMobil for 2024-2025.