Early terminations and day rate reductions for Valaris rigs

Offshore drilling contractor Valaris has seen a number of its drilling contracts terminated and day rates slashed as oil and gas operators are looking to reduce costs by cancelling or delaying drilling activities due to challenging market situation.

In its latest fleet status report published on Wednesday, Valaris also said it had won a couple of new contracts for its floaters and new gigs for its jack-up rigs.

The semi-submersible rig Valaris MS-1 has been awarded a three-well contract with Santos offshore Australia that is expected to start in the first quarter of 2021.

The contract has an estimated duration of 155 days and it also includes a six-well option.

The Valaris 8505 semi-sub has been awarded a one-well contract with Lukoil in Mexico that is expected to start in mid-November, with an estimated duration of 80 days.

The contract with Lukoil also has a one-well option.

Valaris JU-118 (Joe Douglas) has been awarded a three-well contract with Fieldwood offshore Mexico that started in mid-March, with an estimated duration of 425 days.

Valaris JU-144 (EXL II) has won a two-well contract with Fieldwood offshore Mexico that is expected to start in May, with an estimated duration of 200 days.

The contract previously announced with Eni offshore Mexico, which was expected to start in September 2020, was transferred to Valaris JU-102.

Valaris JU-87 has won a one-well contract with Cox in the U.S. Gulf of Mexico, with an estimated duration of 30 days from March 2020 to April 2020, and then extended to May 2020 for another well with an estimated duration of 30 days.

The contract for the Valaris DS-8 drillship, which was scheduled to be completed in November 2020, was terminated early and ended in late March 2020. The rig worked for Total offshore Angola.

The contract with Chevron for the jack-up rig Valaris JU-109, which was scheduled to be completed in July 2021, was also terminated early and ended in mid-April 2020. The rig worked in Angola.

The contract for the drillship Valaris DS-7 for operations offshore Ghana from April 2020 to mid-May 2020 has been terminated.

The Valaris 5004 semi-submersible operated on a reduced day rate from mid-March 2020 to mid-April 2020, at which point the contract was terminated. The rig operated for Mellitah in the Mediterranean.

The jack-up rig Valaris JU-249 (Gorilla VII) ended its contract with Chrysaor in early April 2020.

The rig received another contract with Neptune in the UK, which was transferred from Valaris JU-248. The contract is for four wells, plus two one-well options. It is scheduled to start in August 2020 and end in January 2022.

The drillship Valaris DS-16 (Resolute) is expected to end its contract with Fieldwood in the U.S. Gulf of Mexico in late June 2020.

The Valaris 8503 semi-sub is expected to end its contract with Kosmos in the U.S. Gulf of Mexico in late April 2020.

The Valaris JU-100 jack-up is expected to end its contract with DNO in late April 2020.

The drillship Valaris DS-10 is expected to operate for Shell in Nigeria on a reduced day rate from late April 2020 to mid-July 2020. The rig is then expected to return to full day rate until the end of the contract in March 2021.

The jack-up rig Valaris JU-120 is expected to operate for Chrysaor in the UK on a reduced day rate from late April 2020 to late September 2020. The rig is then expected to return to full day rate until the end of the contract in December 2022.

The Valaris JU-92 jack-up is expected to operate for Chrysaor in the UK on a reduced day rate from mid-May 2020 to late September 2020. It is then expected to return to full day rate until the end of the contract in December 2022.

The Valaris JU-72 is expected to operate on a reduced day rate for Eni in the UK from April 2020 to July 2020. After that, the rig is expected to return to full day rate until the end of the contract in January 2023.

Valaris DS-4, Valaris DS-11, Valaris DS-17, and Valaris 8504 are in the process of being preservation stacked.