Oil giant BP has terminated a contract for the West Sirius semi-submersible drilling rig.
The rig is owned by Seadrill, who said the agreement would end by early May this year, once the current well is completed and demobilised.
A spokesman for the company said it did not expect a “material impact on its cash flow” over the contract period.
Prior to the cancellation notice, the day-rates for the rig, which is operating in the Gulf of Mexico, had been swapped by the West Capricorn.
The West Sirius dayrate had been lowered by $40,000 per day and the term was shortened by two years until July 2017.
Meanwhile the day-rate for the West Capricorn had been increased by $40,000 and the term extended by two years to 2019.
BP said the amortized payments for the West Capricorn, including mobilisation and upgrades, will continue on the original schedule ending in July 2017.
In accordance with the cancellation provisions in the West Sirius contract, Seadrill Partners will receive payments over the remaining contract term, now expiring in July 2017.
The termination will result in a backlog decrease of approximately $160 million.
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