Awilco Drilling is in talks with potential clients for a pair of newbuild harsh-environment rigs to be delivered over the next few years - but has yet to find more work for its sole operating unit ahead of imminent contract expiry.

The UK-based driller is now facing a shrinking backlog for semi-submersible WilPhoenix, which has been working for Shell at the Heron field off the UK but is due to reach the end of its contract in late November or early December this year.

Awilco stated in its third-quarter results presentation that it is hoping to land pending awards in the UK to provide more employment for the 1982-built rig but is also seeking opportunities outside of the North Sea.

WilPhoenix, which is presently the sole source of revenue for Awilco as sister rig WilHunter remains laid up, had a remaining contract backlog of only $7 million at the end of September, compared with $14.3 million at the end of the previous quarter.

The Oslo-listed company earned revenue of $10.3 million in the last quarter largely derived from the Shell contract, compared with $3.2 million a year ago, to leave it with a narrower net loss of $853,000 versus $10.2 million in the same period of 2018.

Awilco is also banking on winning future contracts for one or both of the Moss Maritime CS60 Eco MW-design newbuilds under construction at Singapore yard Keppel Fels for $425 million apiece and due for delivery in March 2021 and March 2022, respectively, with first steel recently cut on the second rig.

Chief executive Jens Berge said in the presentation that “marketing activities towards potential NCS [Norwegian continental shelf] customers for the newbuild rigs are progressing well”, adding the company is in “active discussions with several potential clients in Norway”.

The company sees strong demand for such modern high-specification harsh-environment rigs in Norway “with early indications of positive rate development as contractors await the next round of fixtures”.

Awilco, which has remaining capital commitments totalling $767 million on the two rigs, is keen to secure a future revenue stream for the pair. It also has options for two further newbuilds.

Rigs And Vessels

Awilco in contract talks for newbuilds