Transocean Bags Deals Worth Several Hundred Million Dollars

Transocean Ltd. (NYSE: RIG) has announced several contract awards over the past couple of days.

On March 29, the company revealed contract fixtures for two of its harsh environment semisubmersibles – the Transocean Endurance and the Transocean Norge.

As part of the deals, the Transocean Endurance was awarded a multi-well plug and abandonment contract in Australia with an independent operator, Transocean highlighted. The estimated 240-day contract is expected to commence in January 2024 and contribute approximately $91 million in backlog, excluding fees for mobilization, the company noted, adding that the contract also provides for a series of options, “potentially keeping the rig in Australia through the fourth quarter of 2025”.

In Norway, Wintershall DEA exercised a one-well option on Transocean Norge, Transocean said. The well is expected to commence in May 2023 ahead of the existing firm term for 60 days and contribute approximately $22 million in backlog, Transocean noted.

“These fixtures represent additional evidence of the strength of this cyclical recovery, notably for our harsh environment assets,” Jeremy Thigpen, Transocean’s Chief Executive Officer, said in a company statement.

On March 28, Transocean announced awards for two separate harsh environment semisubmersibles – the Transocean Enabler and the Transocean Encourage.

As part of these deals, the Transocean Enabler will provide drilling services for 19 firm wells and up to eight optional wells for Equinor on the Johan Castberg field in the Barents Sea, Transocean revealed. The estimated 570-day contract is expected to commence in April 2024 and contribute approximately $217 million in backlog, excluding additional services and potential performance bonuses, the company noted.

The Transocean Encourage will provide drilling services for nine firm wells for Equinor in the Norwegian North Sea, Transocean stated. The 460-day contract is expected to commence in December 2023 in direct continuation of the rig’s current program and is anticipated to contribute approximately $165 million in backlog, excluding additional services and potential performance bonuses.

Transocean also highlighted that, as part of the Enabler and Encourage contracts, each rig will receive customer-paid upgrades to digital management systems, robotics, and operational automation. These upgrades are expected to further reduce emissions from the rig and enhance personnel safety, Transocean noted. 

The company also said that it and Equinor have entered into a strategic collaboration agreement to explore future opportunities in areas such as technology development, operational efficiency, and environmental sustainability.

“We are pleased to secure these new contracts and to further strengthen our relationship with Equinor,” Jeremy Thigpen, Transocean’s Chief Executive Officer, said in a company statement.

“These contracts and our strategic collaboration agreement demonstrate our long-term commitment to working together to provide innovative solutions that deliver value to both our companies,” he added.

In a statement posted on its website, Equinor confirmed that, on behalf of several licenses, it had awarded contracts for the use of the Transocean Encourage, mainly in the Norwegian Sea, and the Transocean Enabler, for the Johan Castberg field. The company also confirmed the signing of a strategic collaboration agreement with Transocean.

Equinor pointed out that the rigs have been on eight-year contracts with Equinor that expire on December 1, 2023 and April 1, 2024, respectively. This will be the first contract extension since the rigs were built, as so-called Cat D rigs, specialized for Norwegian conditions, Equinor noted.

“We are pleased to sign a strategic collaboration agreement with Transocean, which is one of our largest rig suppliers,” Mette H. Ottøy, Equinor’s Chief Procurement Officer, said in a company statement.

“This reflects our perception of Transocean as a major contributor to our capability to realize our offshore ambitions also in the years ahead. We have been working closely for many years and are now further expanding this cooperation by reserving one rig for the drilling of both production and exploration wells in the Norwegian Sea, and one rig for the development of the Johan Castberg field,” he added.

Erik G. Kirkemo, Equinor’s Senior Vice President for Drilling and Well, said, “we are now securing hot rigs, which we, together with Transocean, have already invested in upgrading, thus improving safety, reducing emissions and increasing efficiency”.

“Operating for us for the past eight years, we already know the rigs well. We therefore have a lot of experience to build on, and we look forward to continuing our collaboration delivering safe and efficient wells,” he added.

The Transocean Endurance, Enabler and Encourage are all have accommodation for 130 people, a maximum water depth of 500 meters, and a maximum drilling depth of 8,500 meters, according to Transocean’s site. The Transocean Norge has accommodation for 150 people, maximum water depth of 1,000 meters, and a maximum drilling depth of 12,200 meters, Transocean’s site shows.

To contact the author, email andreas.exarheas@rigzone.com

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