Houston-based offshore drilling company Vantage Drilling said it has been awarded three-year contracts for two of its jack-up drilling rigs to work offshore Qatar, starting in the first quarter of 2022.
The jack-ups Sapphire Driller and Aquamarine Driller will begin work offshore Qatar in February and March 2022, respectively, according to Vantage chief executive Ihab Toma.
"We look forward to these multi-year programmes commencing alongside the Emerald Driller’s campaign in Qatar where we have operated since 2016,” Toma said.
The second quarter represented more evidence that the industry is back on the way to recovery
Vantage CEO Ihab Toma
The jack-up Emerald Driller is currently contracted with French supermajor TotalEnergies.
The Sapphire Driller and Aquamarine Driller have recently returned to work with new contracts offshore Equatorial Guinea and Malaysia, respectively.
"The second quarter represented more evidence that the industry is back on the way to recovery," Toma said.
Shortly after the quarter concluded, another jack-up — the Soehanah — also returned to work in Indonesia with Premier Oil, meaning six of Vantage's seven rigs are currently working.
"The safe and seamless return to work by those rigs within weeks of each other is a testament to the operations team at Vantage, of whom I am very proud,” Toma said.
Vantage reported a net loss of $29 million, or $2.21 per diluted share, for the three months ended 30 June 2021, as compared to a net loss of $31.9 million for the same quarter in 2020.
As at 30 June 2021, Vantage said it had $124.4 million in cash, including $13 million of restricted cash, compared with $154.5 million in cash, including $12.5 million of restricted cash at 31 December 2020.
On the up
The floating rig market has been picking up in areas such as the Gulf of Mexico and Brazil, boosted by higher oil prices and an improving economic outlook. With upstream investment booming in the Gulf nations such as Saudi Arabia and Qatar, contract terms are also starting to stretch to multiple years again, as seen with the Vantage deal.
In a recent earnings statement by Houston-based drilling giant Transocean, chief executive Jeremy Thigpen described what he saw as "the beginning of an up cycle in the offshore drilling industry".
Thigpen mentioned the drillship Deepwater Conquerer as having its current contract extended for one well at a rate of $335,000 per day — the third such contract to reach that price level during the second quarter.
“We continue to see an extremely tight market with only one available asset as we enter 2022 and the very real possibility that this market could be sold out of active and available rigs by year’s end,” he said.
“These awards and day rates recognise the scarcity of high-specification, not to mention well-run, deep-water assets.”
In Brazil, Petrobras has been pursuing several tenders for high-spec rigs but is also staging a tender for lower-spec floaters to conduct a series of workover and well intervention activities.
The state-controlled company is in the process of replenishing its rig fleet, as 11 of its 21 units on hire have contracts expiring by the end of next year.
For the first time in more than a decade, Petrobras is also in the market for a jack-up rig, needed to carry out abandonment activities at several ageing shallow-water fields in the Ceara, Potiguar and Sergipe-Alagoas basins.