Rigs report: oil futures briefly top US$70, new deepwater player emerges

Those gains quickly receded after reports said the attacks did not result in any loss of life or damage to the Saudi Aramco tank farm at one of the country’s largest ports, according to the Saudi Ministry of Energy. Yemen’s Houthis claimed responsibility for the attacks.

It was the first time Brent crude oil had topped US$70 in more than a year – since January 2020. Traders pushed oil futures for May down, settling at US$68.24 per barrel.

While overall global offshore jack-up drilling activity fell for week 10 2021, there was an uptick in activity in the North Sea, according to Westwood Global Energy’s RigLogix. Week-on-week, the number of jack-ups contracted inched up two to 23. Positive results were also registered in the deepwater market, with South American drilling underpinning increased activity. Overall, jack-up activity slipped one week-on-week to 324 units, while the floater market rose two week-on-week to 110.

New player in deep water

Speaking of floaters, there is also a new player emerging in the deepwater market. Using proceeds from a private placement, Deep Value Driller AS has purchased the seventh-generation, ultra-deepwater drill ship Bolette Dolphin for US$85M.

The sale was reported by Fearnley Securities in a social media post. “The transaction received strong interest from both Norwegian and international high-quality investors,” said Fearnley, noting that the acquisition “strategically positions the company towards the expected offshore drilling market recovery. Deep Value Driller AS will initially list on Euronext NOTC and plans to list on Euronext Growth as soon as possible.”

VesselsValue head of offshore Robert Day noted that the VV Value for Bolette Dolphin was US$88.3M, with a newbuild cost of about US$650M. “FOE [Dolphin Drilling was formerly known as Fred. Olsen Energy] in late 2018 was in the process of selling Bolette Dolphin for US$340M. This subsequently failed and the rig was once again marketed for sale,” said Mr Day.

The rig has not worked since 2017 when its contract with Anadarko Petroleum was terminated.