Report: Rig contracting activity revved back up in September

Oct. 17, 2022
The 38 contracts signed marks a significant increase over a year ago, according to Evercore ISI.

Offshore staff

NEW YORK CITY – Contracting activity picked up in the back half of September, resulting in 38 contracts signed for 30 rig years, according to Evercore ISI’s latest Offshore Rig Market Snapshot.

That level tops the year-ago level of 19 contracts for 18 rig-years, the firm noted. Operators continue to exercise fixed priced floater options at below market rates, which is causing a drag on average dayrates and contract lengths.

The report also noted that jackups continue to dominate contracting activity. Year-to date, the Middle East has accounted for more than two-thirds of all jackup days awarded, but term contracts were also awarded in the Netherlands, USA, Denmark, and Indonesia over the past 30 days, with improving geographic diversity for term contracts. The report commented that this signals “a broadening of the jackup recovery, in our view.”

But despite the recent increase in jackup rig contracting activity, the firm noted that contracting activity is on track to end the year 6% lower for jackups but 12% higher for floaters.