Diamond Offshore Drilling, Inc. has closed a two-year contract extension with a subsidiary of BP plc within the U.S. Gulf of Mexico.
The contract extension is for the Ocean BlackHornet rig, which begins in February 2025 in direct continuation of the rig’s present contract. The extension represents roughly $350 million {dollars} of further backlog, Diamond mentioned in a information launch Sunday.
“This contract deepens our relationship with a key consumer within the U.S. Gulf of Mexico and is a testomony to the good work the women and men of Diamond do for our clients day in and day trip. This award, together with the latest Ocean BlackLion award, contributes considerably to our 2025 and 2026 backlog and future money flows”, Diamond President and CEO Bernie Wolford, Jr. mentioned.
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Diamond additionally entered right into a drilling contract with Serica Power (UK) Restricted to make the most of the Ocean Patriot for 2 plug and abandonment wells in the UK (UK) North Sea.
This system is predicted to start out in March and to proceed for about 60 days, Diamond mentioned in a separate information launch. The contract represents over $10 million of further backlog, excluding mobilization, based on the discharge.
“These awards replicate the persevering with energy of the drillship market and the enhancing moored floater market within the UK North Sea whereas highlighting the distinctive work of our crews throughout these areas”, Wolford mentioned.
In the meantime, Diamond reported a web lack of $145.7 million for the fourth quarter of 2023, in comparison with $145 million in the identical interval in 2022.
Income for the fourth quarter totaled $298 million in comparison with $245 million within the third quarter of 2023. The rise in income quarter-over-quarter was primarily pushed by the Ocean BlackHawk’s contract begin within the Gulf of Mexico within the fourth quarter after completion of a managed stress drilling (MPD) set up, Particular Periodical Survey and contract preparation work and new contracts for the Ocean Patriot and Ocean Apex, the Houston-based firm mentioned in a latest earnings launch. The income acquire was partially offset by decrease income for the Ocean Braveness on account of contract preparation actions associated to its new multiyear contract in Brazil, it mentioned.
Contract drilling expense for the fourth quarter was $189 million, or a $7 million enhance from the prior quarter, largely on account of larger constitution rental prices related to the managed rigs and the annual bonus expense associated to the drillships’ BOP service settlement, Diamond famous.
On the operations aspect, Diamond’s rigs “continued to carry out nicely”, reaching income effectivity of roughly 95 p.c throughout the fleet for the second successive quarter. “It is a notable achievement given the unusually excessive quantity of shipyard exercise for the corporate’s fleet and the start-up of contracts through the quarter”, based on the discharge.
“2023 was a transformational 12 months for Diamond Offshore”, Wolford mentioned within the launch. “We marked our one-year anniversary of re-listing on the New York Inventory Trade, made measurable enhancements in our capital construction, secured $485 million {dollars} in new contract awards all year long, safely accomplished Particular Periodical Surveys on 5 rigs, and accomplished eight contract start-ups, together with 4 contract commencements within the fourth quarter, one in every of the areas by which we function”.
“The latest $362 million in contract awards are along with our reported backlog of $1.4 billion as of January 1, which is able to end in notable common dayrate enchancment as we transition to new contracts”, he concluded.
Diamond Offshore describes itself as a pacesetter in offshore drilling, offering innovation, thought management and contract drilling providers to unravel complicated deepwater challenges across the globe.
To contact the writer, electronic mail rocky.teodoro@rigzone.com
