Offshore rig market picking up, says Evercore

Feb. 21, 2021
Forty contracts issued so far in 2021.

Offshore staff

NEW YORK CITY – A total of 15 drilling rig contracts have been announced thus far in February, a number that is in line with year-ago levels, according to Evercore ISI’s latest Offshore Rig Market Snapshot.

A total of 25 contracts were announced in January for 12 rig-years, with the split about equal for jackups and floaters; with three term contracts signed for floaters offshore Brazil and China.

Floaters are leading the offshore recovery in February, Evercore says, with 11 contracts accounting for 12 rig-years. Maersk Drilling secured a new four-year contract for the Maersk Venturer for offshore Ghana while Vantage Drilling’s Platinum Explorer won a two-year contract from ONGC for offshore India.

Equinor executed priced options for Seadrill’s West Hercules for a combined 185 days for offshore UK and Norway, as well as one-well options on the Valaris Stavanger and Maersk Intrepid for later this summer.

With Brent north of $60/bbl, Evercore says it expects contracting activity to “easily beat the upcoming Mar/Apr/May/June comps of 13/13/14/9, respectively.” The firm also says that it expects contract terms to continue to increase as operators lock in lower spot day rates.