Odfjell Drilling said the contracts have a combined value of about $290m excluding integrated services, upgrades or modifications and mobilisation fees
Odfjell Drilling signs two rig contracts with Equinor to carry out operations in North Sea region. (Credit: veetec from FreeImages)
Oil drilling, well service and engineering company Odfjell Drilling has signed two rig contracts with Equinor to carry out operations in the North Sea region.
The contracts are related to the two letters of intent (LoI) Odfjell Drilling signed in March this year for the operations of its semi-submersible unit, Deepsea Atlantic.
Odfjell Drilling said the contracts have a combined value of about $290m, excluding integrated services, upgrades or modifications and mobilisation fees.
Besides, the two rig contracts have a combined firm duration of 23 months.
Four priced one well options as well as three further optional periods of about one-year each are available other than the firm periods.
The rates for each period are to be mutually agreed upon before being exercised.
Furthermore, the rig contracts include provisions for performance bonuses as well as fuel incentives.
In line with the contracts, Odfjell Drilling and Equinor have also announced a collaboration agreement to focus on matters of mutual strategic importance.
The agreement will serve as the foundation for a coordinated effort and longer-term engagement on crucial issues, with an emphasis on safety, drilling efficiency, and reduced emissions.
Odfjell Drilling CEO Kjetil Gjersdal said: “We are pleased to confirm that the Deepsea Atlantic will continue to work with Equinor under the new contract which could see the rig in continuous operation until 2029, delivering strong, predictable cash generation from the unit.
“Having worked with Equinor on many project developments through the years, we are pleased to have signed a Strategic Collaboration Agreement to further develop our combined capabilities to deliver safe and efficient operations.”
Odfjell Drilling aims to commence the work immediately after the completion of the special periodic survey for the Deepsea Atlantic, which is currently planned for the first half of 2024.
Currently, the Deepsea Atlantic is signed up to firm contracts until mid-2026, with options that extend to 2029.