Rig Newbuilds Interest in Northwest Europe Picks Up

According to the IHS Petrodata offshore rig database RigPoint, orders of newbuild submersible (semi) drilling rigs for Northwest Europe have picked up in the last few months. Operators have come to the conclusion that the age and technical capability of the current fleet do not meet their requirements for the next phase of the region's development. Drilling contractors are also considering ordering newbuilds speculatively - that is, without a pre-agreed drilling contract.

So far, Norway's Statoil has been the most active oil company, contracting two newbuild semis from Songa Offshore for charters of eight years and four three-year options each. These will be built by Daewoo Shipbuilding and Marine Engineering in South Korea, for delivery by first and third quarter 2014. The $565 million units can work in water depths of 100-500 meters (328-1,640 feet).

In addition, BP is considering building a harsh-environment deepwater semi to cover its Northwest Europe requirements from 2014. Any new unit will probably have to meet BP's new deepwater drilling standards for US Gulf operations, particularly regarding blow-out preventer (BOP) requirements. These are likely to be implemented worldwide.

Currently, at least one drilling contractor is looking at adding speculative newbuild capacity. Chinese-owned COSL Drilling has invited three Chinese yards to bid for the construction of a deepwater semi to be aimed at work off Norway.

The proposed unit (COSLProspector) will have a water depth capacity of 1,500 meters (4,921 feet), and will be designed for Arctic operations. It will be an upgraded version of COSL's current Norwegian-spec newbuilds - COSLPioneer, COSLPromoter and COSLInnovator. If confirmed, it could be delivered in third quarter 2014. The three existing COSL newbuilds and one other unit will be added to the Norwegian sector between now and late 2012.

Odfjell Drilling is also looking to increase its newbuild footprint. The contractor has signed a management agreement with Marine Accurate Well ASA (MARACC) for newbuild drilling and well-intervention semi Island Innovator. The rig will be ready for operations in fourth quarter 2012, after its construction at COSCO Shipyard, China.

The average age of a semi working in the UK sector is 31 years and in Norway is 19 years. Although most newbuild deepwater rigs are aimed at West Africa, Latin America and the US Gulf, drilling contractors recognize high-spec, harsh-environment newbuilds are needed for Northwest Europe, especially when the existing fleet is so old.

To learn more about the RigPoint database or any of the other IHS Petrodata products, please contact us.

Rod Hutton is managing editor, rigs, for IHS Petrodata.