As two new drillship deals come in, Transocean’s backlog tops $7 billion

With the recovery in the offshore drilling market underway, Transocean has secured new long-term contracts for two of its ultra-deepwater drillships, adding over $1.24 billion to its backlog.

Transocean said on Monday that the ultra-deepwater drillship, Petrobras 10000, received a 5.8-year contract for work offshore Brazil with a national oil company. The contract adds an estimated $915 million in backlog and is expected to begin in October 2023 and end in August 2029.

As elaborated by Transocean, the estimated firm backlog excludes income associated with the customer’s anticipated use of the company’s patented dual-activity technology on the Petrobras 10000.

The drillship’s current contract with Petrobras in Brazil started in March 2022 and it is scheduled to end in March 2023. The day rate is $317,000.

Furthermore, Transocean announced that the ultra-deepwater drillship, Deepwater Conqueror, has been awarded a two-year contract by a major operator for work in the U.S. Gulf of Mexico at $440,000 per day with up to an incremental $39,000 per day for additional products and services.

Excluding revenue associated with the additional products and services, the new contract adds an estimated $321 million in backlog and is expected to begin in December 2022 in direct continuation of the rig’s current contract.

The 2016-built rig is currently working for Chevron in the Gulf of Mexico until December with a day rate of $367,000.

Just last week, Transocean issued its fleet status reports, revealing new contracts and extensions for its rigs with a particular emphasis on its drillship fleet and with notable day rate increases.

As previously reported, the company’s backlog in July was $6.2 billion and, with these latest contract announcements, it is now over $7.4 billion.

Transocean on Monday also announced its quarterly results, posting total contract drilling revenues of $692 million, compared to $586 million in the first quarter of 2022. Net loss attributable to controlling interest was $68 million, compared to $175 million in the first quarter of 2022.

Jeremy Thigpen, Transocean Chief Executive Officer, commented: “While the past eight years have been extremely challenging for the entire industry, it is clear that the recovery in offshore drilling is underway, as contracting activity, utilization rates for high-specification ultra-deepwater and harsh-environment assets, and day rates all continue to rise. And, with a backdrop of hydrocarbon supply challenges, we are increasingly encouraged that this momentum could continue for the foreseeable future.”