Drilling major KCA Deutag has been awarded contracts for seven new-build land rigs for operations in MENA nations Algeria, Iraq and Russia’s Western Siberia.
Further, the Aberdeen-headquartered group has won a deal for the provision of integrated well construction services in Russia.
Collectively, these contracts are worth more than $250million.
In addition, the company reports a sharp upturn in North Sea-related activity, notably UKCS platform drilling work, with up to an additional five new drilling strings to be serviced in the next 12-18 months.
The Middle East and North Africa (MENA) and Russian onshore drilling markets are expected to experience double digit growth over the next five years and clients are increasingly asking contractors to undertake all other services associated with well construction in addition to drilling.
KCA Deutag, which currently has a fleet of 63 land rigs, says it is neatly placed to take advantage of the growth in these markets and capitalise on the revenue potential offered by this type of contracts.
For Algeria, three new-build 1,500bhp SpeedRigs are scheduled to mobilise later this year, all destined for work on long-term contracts. A fourth SpeedRig destined for Iraq has already arrived in-country.
Manoj Raghavan, senior VP covering MENA, said: “Securing a number of new builds in Algeria and Iraq clearly demonstrates our desert-type SpeedRig is preferred by clients because of its technical advantages in terms of its enhanced rig mobility and proven efficiency and reliability of Bentec primary components.”
Three further new-builds, also manufactured in Germany by KCA Deutag subsidiary Bentec, will arrive to start work in Western Siberia this year and bring the total number of KCA Deutag of rigs in that region to 15.
Joep Beyer, senior VP for Europe, Kazakhstan and Russia, said: “Our organisation in Russia continues to deliver outstanding operational performance, which is the cornerstone which has helped us secure awards such as this.
“In addition, the Russian operation has just signed its first integrated service contract which involves KCA Deutag delivering, on a lump sum basis, all services related to well construction.
“Being able to manage the delivery of additional services to drilling, such as completions, cementing, mud engineering and testing, amongst others, is of considerable importance for KCA Deutag.
“It is the first time the company has undertaken the subcontracting of such a significant amount of additional work and this will provide the experience to consolidate our position as an integrated service provider in Russia.
“Through the Russian Combined Drilling Services experience, we will be able to export this model to other areas which are starting to perform an increasing amount of contracts on this basis.”
Beyer added that this type of contract will bring additional capability to KCA Deutag and will allow it to increase its overall revenue potential on what is clearly a tight international onshore drilling market, witness current 94% onshore fleet utilisation.”
The growth in onshore drilling within KCA Deutag is also mirrored in the offshore business. Besides the sharp increase in UKCS platform drilling referred to above, the company told Energy that there have been various contract wins in the North Sea, Sakhalin and Africa; plus there are “significant awards pending” in other international markets.