Report: Middle East jackup market remains hot

Sept. 17, 2023
Fifty-three jackups have moved to the region over the past year, says Evercore ISI.

Bruce Beaubouef * Managing Editor

The Middle East jackup market remains “solid,” with NOCs deploying increased capex spending for offshore oil and gas production capacity, according to Evercore ISI’s latest Offshore Rig Market Snapshot.

The report said that competitive pricing and longer-duration contract terms offered in the Middle East and solid demand levels “have spearheaded the current revival in the global jackup market, driving jackup moves to the Middle East since January 2022, which is expected to continue over the next few years.” Between 2022 and 2023, the firm noted that 53 jackups have moved to the Middle East, primarily from Southeast Asia, Mexico, and China.

Yet despite the “massive exodus” of jackups to the Middle East, the region “still demands a further influx of units,” the report said. Out of 53 jackups, 66% and 22% were picked up by Saudi Aramco and ADNOC, respectively, while the remainder were allocated to QatarEnergy, Qatargas, North Oil Company, and other operators.

Overall, contracting activity remains strong for jackups, the report noted, with a total of 10 term contracts announced since August 1st.

“The primary driver of jackup demand remains the Middle East, which accounts for 50% of term jackup contracts announced between August and September and a notable 41 out of 73 term contracts year-to-date,” the firm wrote. It also noted that the year-to-date average contract for jackups surpassed 800 days, which implies an increase of 27% year-over-year.

09.17.2023

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