Petronas Carigali Books Velesto Jack-up Rig

Bartolomej Tomic
Friday, October 1, 2021

Malaysian offshore drilling contractor Velesto has received a letter of award from Petronas Carigali for the jack-up drilling rig Naga 2.

Under the contract worth $12,4 million, Petronas Carigali will use the Naga 2 rig to drill five wells.

Petronas Carigali will have options to extend the deal by up to two wells. The contract is expected to start in December 2021.

The Naga 2 is a jack-up rig with a drilling depth capability of 30,000 feet (9144 meters) and has a rated operating water depth of 350 feet (106.68 meters.)

Velesto recently caught international media attention when one of its offshore drilling rigs, Naga 7, sank off Malaysia.

Naga 7 sank on May 3, while gearing up to start drilling for ConocoPhillips off Malaysia. The incident happened after one of the rig’s legs penetrated into the soil formation while jacking up at Salam-3 well off the coast of Sarawak. The rig tilted and subsequently on May 4, 2021, sank at the site.

During the incident, drilling activities had not started yet started. All 101 rig workers were subsequently transferred to shore.

Under the drilling contract, ConocoPhillips was to use the 2015-built, Gusto-designed, jack-up rig to drill up to three wells. Velesto said after the incident that ConocoPhillips could terminate the contract if the rig is declared a total loss. Later in May, Velesto said it had sent a notice of abandonment to the insurers. 

In a statement in September, Velesto said it had been informed by its insurance underwriters that the NAGA 7 was "a constructive total loss," meaning the contract was considered terminated.

The Naga 7 was a three-legged jack-up delivered by China's China Merchants Heavy Industries in 2015. The rig was built to a GustoMSC design.  It had a drilling depth capability of 30,000 feet (9144 meters) and had a rated operating water depth of 375 feet (114.3 meters).

Categories: Asia Shallow Water Drilling Rigs

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