On Thursday, two more floating rigs (one deepwater, one midwater) were put back on the market early. Noble Corp and Transocean simultaneously reported early terminations notices from Shell and Statoil, respectively.
It was a rough day for rigs named “Discoverer” – coincidentally both cut rigs shared this name.
Large operators continue to cut back their offshore drilling programs. Operators are downsizing their rig fleets to save spread costs even if it means paying early termination fees to rig owners for the convenience.
Although the contractors will largely be made whole on the dayrate for the cut rigs, this means two more uncontracted rigs are looking for work. It’s also a sign of waning demand. And means two more rigs that the contractors will have to stack if they can’t find a job (Noble is already planning to stack their casualty).
Tough Thursday for the already oversupplied floater market.
Noble Discoverer Cut By Shell
Noble Corp announced Thursday that Shell has terminated the contract for the midwater drillship Noble Discoverer. The rig’s contract was scheduled to end in December 2016.
The Noble Discoverer was working for a dayrate of $369,000. Noble will receive an early termination payment of 90% of the operating dayrate adjusted for certain other items. The rig is now mobilizing to Singapore where it is expected to be stacked.
Discoverer Americas Cut By Statoil
Transocean announced Thursday that Statoil has elected to terminate the contract for the ultra-deepwater drillship Discoverer Americas. The rig’s contract was scheduled to end in May 2016.
The rig was working in the US Gulf of Mexico for a dayrate of $590,000. Transocean will receive an early termination payment fully compensating the company as provided for in the contract.