Valaris has extended a contract with TotalEnergies, in the UK North Sea, for the Valaris Stavanger. It has also given some more time to Harbour Energy, while scrapping three ageing rigs in the US.
The extension will run for another 600 days, the US rig owner said. The total contract value for the work is more than $75 million and will begin in the third quarter of this year.
Total’s contract for the Stavanger began in May 2024. The initial contract was for 330 days and valued at $48mn. The rig is on the Culzean field, next to the platform.
Valaris said it had also extended the Valaris 92’s stay with Harbour for a short period. The contract had been due to end in April, but has now been pushed back to June. The contract carries a $95,000 per day rate.
Once the Valaris 92 has finished work for Harbour, it will go to work for Shell. This contract will run for two years, with a total value of $75mn, around $102,000 per day.
Esgian reported, in May 2024, a contract suspension notice for the Valaris 92. This brought forward the end date for work from February 2026 to February 2025.
The rig was carrying out P&A work for Harbour under what had been a two-year contract. This extended the Valaris 92’s work for the company, where it had been under contract – including with Chrysaor – since early 2017.
Rolling into retirement
The rig company said it had taken the decision to retire three semisubmersibles: the Valaris DPS-5, Valaris DPS-3 and Valaris DPS-6. The first has been idle since the second half of last year, while the other two have been stacked for several years.
Valaris CEO and president Anton Dibowitz said the company was focused on “prudently managing our fleet”. It will “retire or divest rigs when the expected future economic benefit for an asset does not justify its costs.”
The thee semisubmersibles have “limited attractive, long-term contract opportunities”, he continued. Scrapping these three, and selling off the Valaris 75 jackup, will “reduce costs for idle rigs, benefit our cash flow and further focus our fleet on high-specification assets”.
Valaris is due to hold its fourth quarter earnings call on February 20. In October, the company said it expected the market in the North Sea still had room for growth.
Valaris’ contracted backlog is dominated by drillships and jackups, for semisubs it has no earnings expected beyond this year. It only has two semisubs remaining, both in Australia with contracts ending in June and September.
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