Shelf Drilling has signed a five-year contract for its recently acquired Shelf Drilling Victory in the Arabian Gulf.
Shelf said the contract was worth $236 million, a day rate of around $129,000. It is planned to start work under this contract in late March 2023. Beyond the five-year term, the contract also has a two-year option.
“We are very pleased to further expand our operations in the Middle East and strengthen our position in a strategically important market,” said Shelf CEO David Mullen.
“This long-term contract is an opportunity for us to build and leverage the experience of our highly capable team and unique operating platform, and demonstrates our ability to consistently generate value for the company. The award will contribute significantly to our contract backlog growth and indicates an improving jack-up market outlook.”
Before the Shelf Drilling Victory goes to work, it must complete reactivation and upgrade work. This is currently under way in the United Arab Emirates.
Shelf bought the rig in July this year, from India’s Aban Offshore. Its previous owner called the jack-up Deep Driller 7.
Shelf struck the deal in June, agreeing to pay $30 million for the rig. The company paid for the rig with cash in hand. The Shelf Drilling Victory was built in 2008. It can operate in water depths up to 375 feet (115 metres).
Growth plans
The company also recently closed a deal in the North Sea, where it bought five jack-ups from Noble Corp. for $375mn. Of this amount, $200mn was for one rig, the Noble Lloyd Noble, while the other four cost $43.75mn each.
Shelf plans to list its North Sea assets on Euronext Growth.
In a recent presentation, Shelf talked about how the tight Middle Eastern market is drawing in rigs from the North Sea. Middle Eastern states with a drive to increase production are turning to wells in shallow waters, the company said.
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