Awilco working to seal new WilPhoenix rig deal. Setting up office in Norway

UK Offshore driller Awilco Drilling is still in talks with an unnamed client to secure work for its WilPhoenix semi-submersible drilling rig. The company hopes to seal the deal soon.

The mid-water drilling rig had, until late April, been under a contract with Apache in the UK North Sea on a $382,500 dayrate. After losing out on a contract with Alpha Petroleum in late 2017, Awilco began the talks with an unnamed company.

In a statement on Wednesday, Awilco said that during the first quarter the WilPhoenix was in continued operations for Apache at the Val D’Isere location before moving to the Garten location where it remained through the end of the quarter.

On April 5, 2018, the rig moved to the N11A abandonment well and finished operations with the Apache contract on April 25, 2018.

This means that Awilco’s two existing rigs, WilPhoenix (warm-stacked), and WilHunter (cold-stacked), are without a contract.

However, Awilco seems optimistic about securing a new deal for WilPhoenix, as it has signed a letter of intent with the unnamed entity, that, if turned into a firm contract should keep the rig busy from September 1, 2018, until “at least” November 2019.

Awilco said the contract negotiations are close to completion. While working on securing the firm contract, Awilco is marketing the rig for summer work programs.

Talking about the North Sea outlook, Awilco has said its sees limited further opportunities in the UK in 2018 but inquiries “suggest that demand in 2019 will be incrementally higher than this year.”

Lower levels of winter utilization are however likely to persist into 2020, Awilco said.

Opportunities in Norway

The drilling company also sees attrition in the harsh environment mid-water space continuing, and “this coupled with stable commodity pricing and forecast decommissioning demand is expected to underpin higher future levels of utilization.”

The company, which has for years operated solely on the UK side of the North Sea, is now increasingly looking at the Norwegian Continental Shelf.

“In the NCS Ultra Harsh Environment space, fixture activity, rate development and asset transaction values are supportive of AWDR’s long-term view of this market,” Awilco said.

The company is thus working on building what it calls “the new Awilco Drilling,” and is working on building an Awilco Drilling organization in Norway, and is looking to start marketing activities towards oil companies operating in the Norwegian waters.

Worth noting, Awilco has recently ordered new CS60 ECO MW semi-submersible drilling rig equipped for harsh environment drilling. It also has independent options to build up to three additional rigs.

The rig, to be delivered in March 2021, is targeted for deployment on the Norwegian Continental Shelf and the Barents Sea.

Awilco, seeing that the operators prefer modern rigs, is hoping the market will have picked up by then, and its new rig will be the most attractive drilling asset up for charter.

Awilco has said that its newbuild – first newbuild offshore rig order in four years – will be the most environmentally friendly drilling rig offered in the harsh environment market.

Offshore Energy Today Staff