May 16th, 2021

 

NEW YORK CITY  &ndash Drilling rig contracting activity has picked up sharply since mid-April, driven by NOCs signing new multi-year contracts for jackup rigs.

According to Evercore ISI&rsquo s latest Offshore Rig Market Snapshot, overall 38 contracts were announced for 67 rig years from mid-April to mid-May, with jackups accounting for 23 contracts and 58 rig years while 15 floater contracts were signed for a &ldquo modest&rdquo nine rig years.

The Middle East led with 11 of 23 jackup contracts, including four multi-year contracts each for Saudi Arabia and Qatar. Including a couple of multi-year contracts signed for ONGC offshore India, there were 11 term jackup contracts signed in April versus only two for floaters in Australia and Brazil. Saudi Aramco also renewed six additional jackups in the first half of May.

Overall, Evercore says that jackup terms are averaging 538 days year-to-date, which is up 15% year-over-year and up 60% from the 2018 trough.

At current oil prices, rigs are flying off the leasing shelves at breakneck speed. Offshore boom is now!