$690,000 for Eirik Raude rig

Ocean Rig is understood to have landed a $690,000 dayrate plus bonus contract for its semi-submersible drilling rig Eirik Raude off Equatorial Guinea, writes Eoin OCinneide.

Ophir Energy is paying $52 million for a three-well programme, including mobilisation and demobilisation fees.

On 23 January, Africa-focused Ophir announced that it had signed up the unit for a firm three-well contract that is expected to take 60 days to complete, with an option for one more well.

Ziad Nakhleh, chief financial officer of Ocean Rig-related shipping company DryShips, told Upstream that the dayrate inclusive of any bonus was at “the high end of the $600,000” range and “closer to $700,000”.

One Europe-based rig broker said the dayrate inclusive of bonus is understood to be $690,000, but pointed to the short-term nature of the contract as a reason behind the surprising number.

“It is not fair to say that this is the market rate. This is very special. It is a very high dayrate but it is a very short period,” the broker said.

“It is very high, because the market rate is probably around $550,000 or something, but that is for a three-year contract of course.

“For just a short contract you run the risk you will have some window periods in between the contracts that will reduce the utilisation over a certain time. That is the reason the dayrate is so high.

“It is unusual in this very good market, because normally you would have to farm-in another rig and then contract it to another oil company. But here, this rig was in between contracts so (Ophir) could take it direct.”

The Eirik Raude will not have to mobilise far to begin work for Ophir in April, as it is currently working off Ivory Coast for Anadarko, having moved from nearby Ghana with Tullow.

The Ophir deal is a good fit for Ocean Rig, as the unit will head off for its special survey following the contract.

This is likely to see the Eirik Raude book downtime of between 30 and 45 days, Nakhleh said, though he would not reveal specific plans.

“We have some yards in our minds,” he said.


Become an Upstream member!

Membership includes a subscription to our weekly newspaper providing in-depth news from the energy industry, plus full-access to this site and its archives. Still not convinced? Try our free trial.

Already a member?