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RigOutlook report released: offshore rig utilisation moves to 51.7%

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Oilfield Technology,


The RigLogix data service group at Westwood Global Energy Group has released its latest RigOutlook, a report which covers the April 2018 – February 2019 period and presents a detailed analysis and one-year forecast of supply, demand and utilisation of the global jackup and floating rig fleets.

Since September 2014, generally recognized as the start of the current down turn, worldwide competitive rig utilisation (jackups, semisubmersibles and drillships) reached a low point of 50.3% in January 2017. It has fluctuated slightly, but has remained in a 3% range since, ending at 51.7% in February 2018.

Key Conclusions

  • Worldwide competitive jackup utilisation remained in the low-mid 50% range from June 2016 through February 2018, despite a lower number of contracted units. Competitive floating rig utilisation has ranged from 46-56% during the same period, with the number of contracted units also falling substantially. A supply reduction in both fleets prevented further utilisation declines.
  • Day rate improvement has occurred in two regions; modest gains have taken place within the US Gulf of Mexico jackup fleet, but rates have more than doubled for the harsh environment semisubmersible fleet off Norway.
  • Jackup attrition will continue in earnest during the next year, but will be offset a bit by newbuild deliveries, some of which are required via Borr Drilling agreement with Jurong Shipyard.
  • Some regions have plenty of planned rig demand, but the number of incremental rigs this adds to the rig count is expected to be minimal as other working units are released.
  • The number of new rig deliveries will continue to be low, although purchases from shipyards and developments in China could increase the number.

As of May 2018, 15 of the 19 marketed harsh environment semis located in Norway were contracted, including four units awaiting contract start. However, only three of the 15 will potentially complete contracts in 2018 and nine of the 15 are committed into 2020 or beyond. With demand for these units expected to continue to grow, operators are now securing contract time for projects that in many cases do not begin for another year or even longer. As a result, day rates have more than doubled from 2016/2017 levels.

In the next year, RigLogix does not foresee a large-scale increase in rig demand globally, although it anticipates that there will be pockets of improvements in utilisation and/or day rates. Longer term, RigLogix does anticipate that more rigs will be put to work and attrition will continue, but believes a return to 90-100% utilisation is still a way off.

Read the article online at: https://www.oilfieldtechnology.com/offshore-and-subsea/01052018/rigoutlook-report-released/

 

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