Seadrill drillship staying busy with US drilling campaign thanks to multimillion-dollar extension

Houston-based energy player Talos Energy has decided to keep a drillship, owned by Seadrill, an offshore drilling contractor, occupied with additional drilling into September 2025.

According to Seadrill, the West Vela drilled its most recent well ahead of schedule, thus, Talos, as the operator with a 50% stake, decided to extend the rig’s assignment for 40 more days, adding approximately $20 million in backlog, which is expected to keep the rig busy into September 2025.

The drillship has completed its work at the Katmai West #2 well in the Ewing Bank area of the U.S. Gulf of Mexico, now renamed to the Gulf of America by President Donald Trump, encountering commercial quantities of oil and natural gas. The entities managed by Ridgewood Energy Corporation hold the remaining 50% interest in the Katmai West field.

The U.S. company highlighted: “The strong performance from Katmai West #1 well, and the successful appraisal from Katmai West #2 well, have nearly doubled the proved estimated ultimate recovery (EUR) of Katmai West field to approximately 50 MMBoe gross, which further affirms Talos’ estimated gross resource potential of approximately 100 MMBoe. The greater Katmai area is estimated to contain up to a total resource potential of 200 MMBoe.”

Based on Talos’ data, the well was drilled in December 2024 under budget and a month faster than expected, finding over 400 feet of gross hydrocarbon pay with excellent rock properties. The first production is expected in the second quarter of 2025, once the well is connected to the existing subsea infrastructure that flows to the Tarantula facility.

The U.S. player also recently began completion operations on Sunspear with the West Vela deepwater drillship. The first production is anticipated late in the second quarter of 2025. The firm projects production levels to be approximately 8-10 million boe/d gross.

The Sunspear asset will be tied back to the Talos-operated Prince tension leg platform (TLP), in which the Houston-based player holds a 48.0% interest, with an entity managed by Ridgewood Energy Corporation holding a 47.5% stake, and an undisclosed partner bringing up the rear with a 4.5% interest.

Moreover, Talos has disclosed its plans to focus on drilling operations on the Daenerys well in the second quarter of 2025. The firm has a 30% interest in this prospect. Recently, the firm agreed to increase its interest in the Monument discovery to 29.76%, up from 21.4%.

This is a large Wilcox oil discovery in Walker Ridge blocks 271, 272, 315, and 316, which will be developed as a subsea tie-back to the Shenandoah production facility in Walker Ridge. The first production is expected between 20–30 million boe/d gross by late 2026 under restricted flow due to facility rate constraints.

In addition, Talos believes there is a 25–35 million boe drilling location adjacent to the discovery that could extend the resource. Beacon is the operator of the asset with a 41.67% stake and Navitas Petroleum is the duo’s partner with a 28.57% interest.

Meanwhile, Talos has also disclosed its Chief Executive Officer (CEO) transition, as Paul Goodfellow will become the firm’s President and CEO and a member of its board of directors, effective March 1, 2025. At the end of 2024, the firm agreed to sell a 30.1% interest in Talos Mexico to a subsidiary of Grupo Carso for an aggregate price of $82.7 million.

This entails $49.7 million in cash and an additional $33.1 million upon first oil production from the Zama field. As a result, Talos Mexico will be owned 20% by Talos Energy and 80% by Carso. The Mexican affiliate holds a 17.4% interest in the Zama field. The transaction is anticipated to close in 2025.

Talos intends to prioritize free cash flow generation as the advancement of key drilling projects is expected to drive future shareholder value creation in its 2025 operational and financial plan. The production for the first quarter of 2025 is estimated to be between 99 and 101 million boe/d, with 68% being oil volumes.

The company’s maintenance activities include work scheduled for assets such as Katmai, Pompano, and Brutus, in addition to third-party pipeline maintenance. The production for the full year 2025 is expected to range from 90 to 95 million boe/d, consisting of 69% oil and 79% liquids.