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The Offshore Frontier

IHS Markit: Offshore dayrates will be better in 2020, just not as much as drillers hope for or need

As debt covenants come due, offshore drilling contractors may be forced to push harder for higher dayrates By Linda Hsieh, Editor & Publisher Offshore drillers can expect to see a better market in 2020, but it won’t be the kind of dramatic recovery that the industry is hoping to see. “It will be an improvement over 2019, just not dramatically,” said Cinnamon Edralin, Senior Offshore Rig Market Analyst for IHS Markit. Globally, IHS Markit expects demand to increase by about 18%, or about 90 rigs, over this year. That translates into approximately 561 units – 400 jackups, 86 semis and 75 drillships, according to Ms Edralin. More than half of that increase is expected to come from the jackup segment. ...

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As operators reshuffle priorities, offshore exploration is losing out

Development drilling is likely to increase, but it can’t offset a bigger reduction in exploration drilling in 2020 By Linda Hsieh, Editor & Publisher The attacks on two Saudi Aramco oil facilities on 14 September took out approximately 5.7 million barrels per day from the global oil supply, leading to a quick spike in oil prices to nearly $70 in the second half of September. However, by early October, things seemed to be back to business as usual, with oil prices settling down into the $50s. “Of course, a large portion of the increase in oil prices was a risk factor premium,” said Audun Martinsen, Partner and Head of Oilfield Service Research for Rystad Energy. “It will be a short-term ...

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Optimism rising for jackup outlook as utilization, dayrates both improve

Non-harsh environment floater market is relatively weaker, but positive signs can be found in new contracts signed in 2019 By Linda Hsieh, Editor & Publisher You can’t quite say the outlook for the offshore drilling market is rosy just yet, but some of the gloom is definitely letting up, according to David Carter Shinn, Partner and Head of Bassoe Analytics at Bassoe Offshore. Particularly in the jackup segment, 2020 should be a step above recent years, he said. “We’re much more optimistic than we were a year ago. With respect to jackups, we’re seeing strong growth in the number of rigs on contract and demand.” Bassoe Analytics, an open-source collaborative rig database, shows that there were around 340 working jackups ...

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Vessel selection, lessons learned in using a drillship for temporary abandonment of 15 subsea wells

Drillship edges out light well intervention vessel after operator analysis of multiple technical, commercial factors By William Liew Sin Yoong, Khalil Mohamed M’bareck, Shahira Emie Lyana Bt Mustaffa and Mohd Hairi Abdul Razak, PETRONAS; Frederic Jacquemin, William Zomerdijk, PACIFIC DRILLING As the final stage in the oil and gas field life cycle, abandonment and decommissioning (A&D) activities are inevitable and have been increasing. For one deepwater subsea field offshore Mauritania in West Africa, the operator decided to cease production due to depleted reservoirs and the low oil price environment. This article discusses how the operator selected the drillship to carry out the A&D project, including considerations of the advantages and disadvantages in using a drillship for such operations, as well ...

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Local deepwater rig supplies tighten in US Gulf, Brazil as dayrates inch up

Recovery is slow, but positive momentum is building in key deepwater markets By Leslie Cook, Wood Mackenzie Floating rig backlog grew by over 21 years in Q3 2019, while global utilization finally crossed the 70% line. After four years of aggressive cost cutting and razor-thin returns, it finally appears that drillers are starting to come out of the woods. But despite rising utilization and backlog, pricing remains stubbornly low, most notably in key deepwater regions such as the US Gulf of Mexico (GOM) and Brazil. The aim of this article is to shed light on these two important deepwater regions and discuss what that can mean for drilling contractors seeking work and operators seeking rigs in 2020. Local supply tightens ...

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ANPG of Angola publishes fiscal terms and bid rules

The National Agency for Petroleum, Natural Gas and Biofuels of Angola has announced the terms of reference, bidding rules and qualification criteria of its 2019 bid round, starting the countdown to a 12 November 2019 deadline for operators and interested parties wishing to bid on the 10 frontier blocks located in the Namibe and Benguela Basins...

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