Bermuda-domiciled but essentially Norwegian company Seadrill has ordered two high specification jack-up drilling rigs from Dalian Shipbuilding of China.
The $460million order comes less than a month since the company placed orders for a batch of ultra-deepwater drillships at a ticket price of $2.4billion overall and marks the latest step in its aggressive expansion programme.
The latest jack-ups order is due for delivery during Q2 and Q3 2016. They will be based on the F&G JU2000E design and be capable of working in water depths to 122m (400ft) and drilling depth of 3,050m (30,000ft).
This brings Seadrill’s jack-ups order book at Dalian to 10 of which two are nearing completion and due this year, five in 2015 and three in 2016.
Seadrill’s order-book now totals 24 units, including nine drillships, a pair of harsh environment semi-submersibles, and 13 high specification jack-ups.
In addition the company has fixed priced options for two ultra-deepwater units and likely has the most ambitious build programme of any drilling company.
Seadrill’s board believes that the jack-up market continues to provide a “compelling investment thesis”.
The global jack-up market is said to be at an inflection point as approximately 60% of the global contracted fleet was built before 1993.
Almost 100 newbuild jack-ups have been delivered since 2005 while the number of stacked rigs has dropped to multi-year lows. Utilisation rates have been above 90% of late while average dayrates, unmet demand and average contract lengths have all increased.
“We are of the opinion that the current order book falls well short of adequately supplying oil company needs going forward,” said Seadrill.
“Currently, the order book stands at approximately 115 units of which approximately 50% are not competitive on a global basis. Most of these uncompetitive units are either low specification or destined for markets with regional factors that will limit their global mobility.”
The company said too that it was in discussions about long-term chartering for several of its jack-ups.
The company’s CEO, Per Wullf, said: “The market for high specification jack-up units is poised for a significant uplift in dayrates and we continue to invest in order to put Seadrill’s shareholders in a prime position to benefit.”
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