Dolphin Drilling has agreed to sell its Blackford Dolphin semi-submersible drilling rig to SPM Energy Shipping for up to $25 million and entered into a preliminary agreement for the management of future drilling contracts involving the rig and at least one additional semi-submersible unit.
Under the definitive sale and purchase agreement signed on October 26, SPM or its guaranteed nominee will pay $10 million upon delivery of the rig, with a further $15 million payable when SPM receives its first payment under a potential future drilling contract.
The transaction is expected to close around November 5, 2026, in Singapore, with the sale expected to reduce Dolphin Drilling's operating costs, eliminate capital expenditure associated with the rig's class renewal survey and strengthen its financial position.
The Blackford Dolphin semi-submersible drilling rig, built in 1974 and upgraded in 2008, has a maximum operating water depth of 6,000 feet (1,829 metres) and can drill to depths of up to 30,000 feet (9,144 metres).
The companies have also signed a memorandum of understanding (MoU) covering potential management arrangements for Blackford Dolphin, another semi-submersible rig and any additional units agreed between the parties.
Under the proposed arrangements, SPM would market the rigs in India and other agreed regions, while covering capital costs, operating expenses and guarantees related to future drilling contracts as the rig owner.
Dolphin Drilling would have opportunities to generate management fees through the arrangements, which remain subject to definitive agreements and customary closing conditions.
“Dolphin Drilling will through the Sale and contemplated Management Arrangements materially de-risk the Company and at the same time, significantly reduce operating costs as well as eliminate capital expenditures associated with the class renewal survey for the Blackford Dolphin. The transactions provide for potential future upside through management of Blackford Dolphin and one or more additional semi-submersible drilling rig resulting in future management fees and ability to grow our platform” said Ronny Bjørnådal, Chairman of Dolphin Drilling.
The proposed partnership also involves SPM's marketing consultant, Valiant Oil and Gas (VOG), and would combine Dolphin Drilling's operating capabilities with the companies' commercial presence in India and surrounding regions.
The sale is expected to reduce Dolphin Drilling's interest-bearing debt while allowing the company to pursue additional revenue from rig management without retaining ownership of the units.
At the end of the second quarter of 2026, Dolphin Drilling reported cash holdings of $55.1 million and a firm contracted revenue backlog of $556 million, with another $446 million in options, following multi-year contracts secured for Paul B. Loyd Jr. and Borgland Dolphin.
In its most recently reported quarter, Paul B. Loyd Jr. achieved 99.8% uptime, while Blackford Dolphin recorded 90.2% uptime and reached 1,000 days without a lost-time injury.
Dolphin Drilling operates in the mid-water and deepwater semi-submersible drilling market, where limited newbuild activity and the retirement of older rigs have reduced the available supply of moored floating units.
The company identified India, Southeast Asia, Mexico and West Africa among the regions where offshore development activity is supporting demand for drilling rigs.
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