Malaysia-based offshore drilling contractor Velesto Energy has mutually agreed with PC Ketapang II, PC North Madura II and PETRONAS North Ketapang to terminate, without cause, a contract for the NAGA 8 jack-up drilling rig offshore Indonesia.
The contract, awarded in May 2025, was originally scheduled to begin in July 2025 and covered a firm programme of 12 wells and three optional wells over four years. It also included a planned suspension period from February to July 2026, during which Velesto retained the right to market the rig for alternative work before operations were due to resume in July 2026.
Before the termination, Velesto completed Phase 1 of the project, drilling three of the 12 committed wells over approximately eight months.
The company said the termination, which took effect on July 7, allows it to actively market the NAGA 8 rig for alternative deployment opportunities while pursuing contracts with improved commercial terms, an optimised drilling sequence and stronger overall commercial prospects.
Velesto added that the termination is not expected to have a material adverse impact on its earnings or net assets for the financial year ending December 31, 2026, as the rig is currently deployed under a separate contract with Jadestone Energy for the East Belumut Phase 9 infill drilling project offshore Malaysia.
That contract, announced in February 2026, is valued at about $16.5 million and runs from March to July 2026, keeping the NAGA 8 in operation while the company pursues further opportunities.