Rigs report: jack-up rig market sky high on Middle East investment

Utilisation for jack-up drilling rigs and service vessels in the region are already high and charter rates are climbing, Riviera Maritime Media’s OSJ Middle East Conference heard.

Plans by Saudi Aramco, Abu Dhabi National Oil Corp and Qatar Energy to develop more offshore fields and increase drilling activity will generate higher demand and a need to build new drilling rigs, according to an expert panel.

Gulf Marine Services commercial director Jamie Taylor highlighted the many positive trends and dynamics that are currently helping drive growth in the regional jack-up sector for drilling contractors and vessel owners.

He said utilisation was already exceeding 90% for the 94 jack-ups now working in the region. He then outlined development plans and future projects for ADNOC, Aramco and Qatar Energy set to be implemented that will span many years.

Shelf Drilling director Rahul Mehrotra analysed the regional outlook for the jack-up rig market, which currently stands around 94%, driven by rising investment in oil and gas drilling, developments and exploration.

Outside of the Middle East, though, jack-up rig counts are falling as international energy companies focus more on deepwater projects and less on those in shallow waters.

Mr Mehrotra said he believes that demand will pick up again in 2024 as other energy companies will look to ramp up capacity.

He said he thinks potential jack-up demand could find growth in various markets including India, Africa and the North Sea, due to emerging carbon capture projects.

Energy companies have evolving capability needs with some requiring high-spec jack-up rigs to conduct drilling in water depths that are close to the top-end of their capabilities, or to jack-ups suited for marginal field developments. This complexity creates opportunities, said Mr Mehrotra.

On the technology side, Jacking Solutions International managing director Franck Jaussaud presented some of the innovations boosting the reliability of jack-up rigs and self-propelled vessels.

He presented a case study in which a vessel rebuild was deferred and uptime on an existing unit was extended thanks to comprehensive leg shimming, guide adjustment and upgrade investments.

With advanced modelling now allowing detailed wear mapping over time, Mr Jaussaud said he believes that smarter leg assessments and procedural upgrades can significantly extend jack-up working life and reduce failure risks.