Odfjell Drilling Secures $290M Contract with Equinor for Deepsea Atlantic Rig

Norwegian offshore drilling contractor Odfjell Drilling Ltd. has won contracts with Equinor for its Deepsea Atlantic semi-submersible drilling rig.

The contracts have been signed further to the signing of two Letters of Intent signed back in March. Odfjell Drilling did not say who the client was at the time.

The contracts have a combined firm duration of 23 months and a value of about $290 million excluding integrated services, upgrades, modifications or mobilization fees. The contracts also include provisions for performance bonuses and fuel incentives.

In addition to the firm contract periods, there are four priced one well options as well as three further optional periods of approximately one year each, with the rates for each period to be mutually agreed prior to exercising.

The work will begin immediately following completion of the Special Periodic Survey for the Deepsea Atlantic, which is currently planned during the first half of 2024.

The Deepsea Atlantic is now signed up to firm contracts until mid-2026, with options which extend to 2029, Equinor said.

Strategic Collaboration Agreement

"Together with the two contracts, Odfjell Drilling and Equinor have also entered into a Strategic Collaboration Agreement to focus on matters of mutual strategic importance. With a focus on safety, drilling efficiency and lower emissions this agreement shall provide the framework for a joint effort and longer-term collaboration on these key matters," Odfjell Drilling said.

Kjetil Gjersdal, Chief Executive Officer of Odfjell Drilling 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. Continuous development of our workflows and technologies is a key focus for Odfjell Drilling and we look forward to seeing the results of this initiative.”