Following weeks of sluggish rig contracting activity, a new floater contract was confirmed this week, adding a year of backlog to one of Transocean's drillships. Meanwhile, several drilling contractors have submitted bids for a tender in Brazil seeking up to four high-specification floating rigs.

By Nermina Kulović Čilić, Esgian

Contracts

Transocean has secured a one-year contract with an undisclosed operator in the US GOM for the 7th generation 12,000-ft drillship Deepwater Conqueror. The contract is scheduled to start in October 2025. According to Transocean, the contract is expected to add approximately $193 million to its backlog, including additional services. The MPD-ready Deepwater Conqueror, a DSME 12000-design rig, is currently working for Chevron in the US GOM on a $440,000 dayrate. The Chevron contract is scheduled to conclude in mid-April 2025.

Drilling Activity and Discoveries

Mexican state oil company Pemex has received approval from regulatory agency Comisión Nacional de Hidrocarburos to drill the Xomili-1 exploration well. Xomili-1 will be drilled with Perforadora Mexico 400-ft jackup Campeche in around 115 ft (35 m) of water on AR-0149-2M-Uchukil. The drilling programme is expected to take around 111 days, including 77 days to drill the well and 34 days to terminate it, with work beginning in late October 2024 and continuing into February 2025. Pemex estimates costs for the well at around $38.05 million for drilling and $12.9 million for termination. The jackup Campeche has been working for Pemex over much of the previous decade.

Partner Woodside has confirmed that the TotalEnergies-operated Niamou Marine-1 well offshore the Congo reached its total depth in September 2024 and did not encounter hydrocarbons. TotalEnergies began drilling the Niamou Marine-1 well on the Marine XX permit offshore the Republic of Congo in May 2024 with Odfjell Drilling managed 10,000-ft semisubmersible Deepsea Mira. Following the completion of the well, TotalEnergies moved the Northern Ocean rig back to Namibia to drill the Tamboti-1X exploration well.

Santos has informed that well logging activities at the Halyard-2 infill well, located off Western Australia, have confirmed the intersection of a gas column with reservoir quality meeting pre-drill expectations. The new Halyard-2 well will replace the now-depleted Halyard-1. Drilling started on 22 September 2024 in the Carnarvon Basin, using Noble's 6,000-ft semisubmersible Ocean Apex. Santos said on Thursday in its third-quarter report that well completion and testing are expected to be finalised in the coming weeks. Once connected to the existing pipeline network in early 2025, Halyard-2 will supply gas to the Varanus Island Plant. The well is situated in the Greater East Spar (GES) field, within Commonwealth waters. According to the environment plan accepted by NOPSEMA in July, drilling operations are expected to take around 50 days. Also, Santos stated Thursday it had completed decommissioning of thirteen wells within the Harriet Joint  Venture, and three of eleven wells across the Mutineer, Exeter, Fletcher and Finucane fields.

Woodside's plugging and abandonment campaign at the Stybarrow field area, offshore Western Australia, has reached the 40% mark. The company shared the progress update this week in its quarterly report. To date, four wells have been plugged and abandoned. The campaign, which started in Q1 2024, involves the permanent P&A of the Stybarrow development wells within offshore Permit Area WA-32-L. The scope of work includes the P&A of ten subsea wells, comprising production, gas injection, and water injection wells, along with the removal of all well infrastructure above the mudline. Woodside is using the 1,640-ft Transocean Endurance semisubmersible rig for the project. The 6th generation harsh-environment rig has a firm contract with Woodside until June 2025. Woodside also has extension options that could keep the rig busy until April 2026. It is understood that the Transocean Endurance will be used for the Julimar Development Phase 3 Drilling, starting from 1Q 2025.

Demand

Mexican regulatory agency Comisión Nacional de Hidrocarburos has approved a plan by Pemex Exploracion y Produccion to drill an exploration well on Asignacion AE-0110-4M-Cinturon Plegado Perdido-09 in deep waters of the Gulf of Mexico off the state of Tamaulipas. Pemex plans to begin drilling the Kuajtla-1 in the fourth quarter of 2026, with drilling continuing through the first quarter of 2027 towards a total depth of 8,900 meters (29,199 ft). Pemex plans to spend around $184.4 million on the project, with $177.23 million of this going towards the drilling of the well.

Woodside Energy has been granted Exploration Permit WA-554-P in the Barrow sub-Basin offshore Western Australia. Woodside has a 100% working interest in the permit. WA-554-P comprises a total area of 943 square kilometres. Under the grant, Woodside has this permit until September 2030. The work program includes seismic reprocessing, geotechnical studies and well planning into the second half of 2028, with one exploration well to be drilled between September 2028 and September 2029.

Seven drilling contractors have submitted bids to Petrobras in a tender for up to four high-specification floating rigs. Bidding on the tender, which is divided into three lots, closed on 16 October 2024. Drilling contractors understood to have submitted bids include the Brazilian subsidiaries of international drilling contractors Transocean, Seadrill and Valaris, alongside Brazilian companies Ventura Offshore, Foresea, Etesco, and Constellation Oil Services. Lot 1 of the tender is for a rig with managed pressure drilling for a contract length of 1,095 days (3 years) with a potential two-year extension, starting from January to March 2026. Lot 2 is for one dynamically positioned high-spec rig for three years plus a two-year extension, starting between September 2025 and March 2026. Lot 3 has the same terms as Lot 2 but is for up to two rigs.

Mobilisation/Rig Moves

After completing the P06-07 well for Wintershall Noordzee in the Dutch sector of the North Sea, Swift Drilling’s jackup Swift 10 went into drydock in Schiedam, the Netherlands in early September 2024 for necessary maintenance. The maintenance in the yard was completed in record eight days, according to Swift Drilling. In mid-September, the rig returned to work for Wintershall Noordzee on the P06-C02 well. The rig is working for the operator under a long-term P&A contract for up to four years. The contract was secured in early 2021 and started in August of the same year. By July 2022, the rig completed operations on 19 wells.

Other News

ExxonMobil has signed an offshore carbon dioxide (CO2) storage lease with the Texas General Land Office, securing the company access to around 271,068 acres in Texas state waters for CO2 storage projects. The leased areas are in submerged state land offshore Jefferson, Chambers and Galveston Counties. Under the terms of the agreement, ExxonMobil will have the right to inject CO2 into geologically secure strata located approximately one to two miles below the surface of the US GOM. The Texas General Land Office called the agreement “the most extensive carbon capture and sequestration transportation and storage lease in state history.” ExxonMobil stated that the offshore acreage would complement the onshore CO2 storage portfolio that it is developing. ExxonMobil Low Carbon Solutions President Dan Ammann said that the company would drive “substantial emissions reductions along the Gulf Coast through a comprehensive solution that includes capture, transportation, and storage.”

Shelf Drilling Ltd and indirect subsidiary Shelf Drilling (North Sea) Ltd have formally completed a merger, resulting in Shelf Drilling (North Sea) becoming a wholly owned subsidiary of Shelf Drilling. The combined company will begin trading on the Oslo Stock Exchange on 14 October 2024. Merger consideration shares of 1.05 shares in Shelf Drilling for each Shelf Drilling (North Sea) share will be delivered to eligible Shelf Drilling (North Sea) shareholders on 16 October 2024. The merger was announced in mid-September 2024. Shelf Drilling (North Sea) was created in October 2022 following Shelf Drilling’s acquisition of five jackups from Noble.

Hibiscus Petroleum has completed its acquisition of TotalEnergies Brunei, becoming the operator of the Block B Maharajalela Jamalulalam (MLJ) field in Brunei Darussalam, with a 37.5% stake. The block is located 85 kilometres off the coast of Brunei. The MLJ field began production in 1999. In 2023, the field produced approximately 9,000 barrels of oil equivalent per day for TotalEnergies. The MLJ field primarily produces gas and condensate. Hibiscus' joint venture partners in Block B are Shell Deepwater Borneo B.V. (35%) and Brunei Energy Exploration Sdn Bhd (27.5%). The concession is valid until November 2029, with the possibility of extension subject to mutual agreement among the joint venture partners. As previously reported, TotalEnergies agreed in June 2024 to sell its Brunei subsidiary, TotalEnergies EP (Brunei) B.V., to Hibiscus Petroleum for $259 million. Hibiscus has stated that this acquisition will add up to 21.7 million barrels of oil equivalent (MMboe) to its 2P reserves, representing a 36% increase from 60.9 MMboe to 82.6 MMboe, and also boost the gas production share of the company's portfolio to nearly 50%.

Qatar-based Gulf Drilling International (GDI) has renamed three jackup rigs it purchased from Seadrill earlier in 2024. GDI agreed to acquire the 400-ft rated West Castor, West Telesto, and West Tucana for $338 million in May 2024, with the transaction closing in June. The ex-Seadrill rigs, all operating under contracts in Qatar, have been renamed Al Bidda (formerly West Castor), Laffan (formerly West Tucana), and Mesaieed (formerly West Telesto). Al Bidda is contracted to QatarEnergy LNG until late April 2026. Laffan is working for Shell under a contract that runs until late August 2025, and Mesaieed is on contract with QatarEnergy LNG until late May 2025.

Constellation Oil Services Holding S.A is contemplating a comprehensive recapitalization involving all current shareholders and debt holders, conducted via an acquisition and merger with a special purpose vehicle owned by third party investors. The company has launched a junior capital raise. Constellation expect the recapitalization to consist of $600 million to $630 million of junior capital from existing stakeholders and third-party investors, around $650 million of new debt in senior secured high yield bonds, and $660 million cash redemption of existing debt and equity holders. Under this plan, all Constellation’s current financial debt will be converted into junior capital or repaid. The new junior capital would be raised, and the merger would occur at a combined debt and equity valuation of $1,150 million to $1,250 million. Constellation stated that its day-to-day operations will not be impacted by this process. Constellation has a fleet of seven floating rigs working offshore Brazil and recently secured contracts with Petrobras that will see it managing new 12,000-ft drillship Tidal Action in 2025.

Brazilian state company Petrobras and its partners have signed three remaining concession contracts for blocks in the Pelotas Basin offshore southern Brazil. The blocks were auctioned as part of the 4th Permanent Concession Offer Cycle, held by the National Agency of Petroleum, Natural Gas and Biofuels. Petrobras acquired 29 concession contracts in the Pelotas Basin during this auction. The final three, blocks P-M-1737, P-M-1739 and P-M-1797, will have Petrobras as an operator with a 50% interest. Shell and CNOOC are partners in the consortium with 30% and 20% stakes, respectively. The other 26 blocks acquired by Petrobras in the 4th Permanent Concession Offer Cycle were acquired by Petrobras in partnership with Shell. For those blocks, Petrobras is the operator with a 70% interest while the remaining 30% is held by Shell.

Northern Ocean Ltd. (NOL) has entered into a Letter of Intent (LOI) with Kinetic Pressure Control, a well control technology company that designs, manufactures, and provides wellhead and pressure control equipment. The purpose of the LOI is to outfit NOL’s 6th generation semisubmersibles, the Deepsea Mira and the Deepsea Bollsta, with the Kinetic Blowout Stopper (K-BOS). NOL believes that the K-BOS system’s ability to secure the well in less than a second will enhance its competitive position in the market and its ability to secure new contracts in the ultra-deepwater and harsh environment segments where the owner is marketing the units for future work. Currently, the 10,000-ft Deepsea Mira is employed by TotalEnergies in Namibia, rolling off its firm contract in early 2025, but with an existing option that could keep it busy into Q2. The 7,500-ft Deepsea Bollsta is en route to Ghana for a recently announced contract with Springfield, which will keep it busy into late November 2024. This will be followed by a contract with Chevron in Namibia, fixed in late June 2024, which is scheduled to end in Q1 2025.

Hungary's MOL Group has signed a Memorandum of Understanding with Turkish Petroleum Corporation (TPAO) to cooperate in the exploration and production of hydrocarbons. MOL said the two firms agreed to elevate their cooperation to a new level after successful international joint projects to a potential partnership in exploration in Türkiye and further potential projects in other regions. The MoU covers potential joint participation in exploration, field development and production projects in the Caspian region, Türkiye, North Africa and the Middle East as well as in Central and Eastern Europe. MOL and TPAO have been cooperating in hydrocarbons exploration and production projects as joint venture partners in Azerbaijan in the Azeri-Chirag-Deepwater Gunashli (ACG) offshore field, and in the onshore Baitugan field in Russia.

CNOOC Limited subsidiary CNOOC Petroleum Brasil Ltda, has entered into a concession contract for block S-M-1813 in the Santos Basin offshore Brazil. The company has a 100% operated interest in the block. The Santos Basin block was acquired from the 4th Permanent Concession Offer Cycle, held by Brazil’s National Agency of Petroleum, Natural Gas and Biofuels. In the same cycle, CNOOC Petroleum Brasil Ltda also secured 20% non-operated interests in blocks P-M-1737/39/97 in the Pelotas Basin. Petrobras is the operator of these blocks with a 50% interest while Shell has a 30% interest.

The Falkland Islands Government (FIG) has agreed to extend all of Rockhopper Exploration's North and South Falkland Basin Petroleum Production Licences. Rockhopper, a 35% partner in the Navitas-operated Sea Lion oil field project in the Falkland Islands, said back in September it was engaged with FIG on licence extensions, prior to their expiry in November 2024. On Friday, the company announced that FIG had approved the extensions, which will now run until 31 December 2026. As previously reported, the Sea Lion project will be developed in two phases. Phase 1 is expected to involve 11 wells, with production through an FPSO, targeting the first oil by the end of 2026. A second phase, comprising 12 additional wells, is planned to follow one to two years later. Navitas, which holds a 65% stake in the project, has indicated that a final investment decision (FID) for the Sea Lion project is anticipated in 2024.

Original article   l   KeyFacts Energy Industry Directory: Esgian