Aramco's Rig Suspensions: Shaping the future of the global jackup market?
Summary
TLDRIn May's edition of the Estrian Rig webinar series, Matthew Donovan, Head of the Estrian Rig Market Research Team, discusses the impact of Saudi Aramco's rig suspensions on the global jackup market. With 22 jackups suspended for up to 12 months, the presentation explores supply and demand trends, regional market impacts, and day rate forecasts. Donovan highlights potential shifts in rig utilization and the possibility of rigs securing work in other regions like Southeast Asia and West Africa. The webinar anticipates a short-term blip in market utilization and day rates, with a return to normalcy by 2025.
Takeaways
- đ Global Jackup Supply Overview: There are 499 jackup units worldwide, with 72% currently drilling or contracted. The Middle East has the largest fleet, followed by the Far East and Southeast Asia.
- đ Recent Trends: Utilization rates have been increasing, but there has been a slight dip in active rigs and competitive utilization in Saudi Arabia and the UAE due to contract suspensions.
- đąïž Impact of Aramco's Decision: Aramco received a directive to maintain its crude oil production at 12 million barrels per day, reversing a previous plan to increase to 13 million barrels per day.
- đ Aramco's Rig Strategy: Aramco plans to reduce offshore oil rigs and increase gas project rigs, aiming to maintain over 300 rigs in total, shifting some towards natural gas projects.
- đ« Contract Suspensions: Aramco has issued contract suspensions for up to 12 months on 22 jackup rigs, affecting several drilling contractors.
- đ Rig Reallocation: Rig owners are marketing the suspended jackups globally, with some already securing long-term contracts in other regions.
- đ Regional Challenges: Jackups moving to new regions may face challenges such as regulations, technical requirements, and age of the unit, which might require modifications for compliance.
- đ Market Forecast: Global jackup demand is expected to pick up by 2025, with West Africa, India, and Southeast Asia expected to absorb much of the excess supply.
- đ° Day Rate Forecast: Near-term day rates are expected to flatten due to increased availability and market uncertainty, but should begin to rise again by 2025 due to strong utilization and limited supply.
- đ Regional Demand: Southeast Asia and India are highlighted as regions with potential for increased jackup demand, with several long-term requirements and attractive markets.
- đ ïž Maintenance and Repair: Some drilling contractors intend to use the suspension time for maintenance and repair of their rigs.
Q & A
What is the current global jackup supply status?
-As of the presentation, there are 499 jackup units globally, with 72% of them actively drilling or contracted.
Which region has the largest number of jackup units?
-The Middle East has the largest number of jackup units, with nearly 200 units, followed by the Far East and Southeast Asia.
How has the jackup market utilization been trending in recent years?
-Utilization has been trending generally upwards, with increased demand in the Middle East boosting global utilization as excess capacity from other markets moved there.
What impact did Saudi Aramco's directive have on rig contracts in Saudi Arabia?
-Saudi Aramco received a directive to maintain its maximum sustainable crude oil production at 12 million barrels per day, leading to adjustments in its rig fleet and contract suspensions.
How many jackup rigs are currently under contract with Saudi Aramco, and what changes are expected?
-Saudi Aramco currently has around 75 jackups under contract, with plans to reduce the number of offshore rigs for oil projects while increasing rigs for gas projects.
What was the total number of jackups known to be affected by contract suspensions?
-A total of 22 jackups are known to be affected by contract suspensions.
How are the suspended rigs being handled in terms of contract terms?
-The suspended rigs have their contract backlog preserved by adding the suspension time back to the contract as an extension once they restart work.
What challenges might drilling contractors face when trying to market their rigs outside of Saudi Arabia?
-Challenges include country regulations, technical requirements, and the age of the drilling unit. Some rigs may require modifications or upgrades to comply with local regulations and operating conditions.
How many of the suspended rigs are likely to be competitive in the international market?
-Around 15 of the 22 suspended rigs are likely to be competitive in the international market.
What is the current forecast for global jackup demand and utilization by 2025?
-Global demand and utilization for jackups are expected to remain high by 2025, with demand in West Africa, India, and Southeast Asia expected to absorb much of the additional excess supply.
What is the expected impact of the suspensions on global jackup day rates in the near term?
-Near-term flattening of day rates is expected due to the unexpected boost in availability and market uncertainty as contractors work to secure additional contracts.
How might the suspensions affect the North Sea market?
-The North Sea market is unlikely to be significantly affected as it requires harsh environment jackups, which are different from the rigs released by Saudi Aramco.
What is the potential impact of the suspensions on drilling contractors' willingness to work with Saudi Aramco in the future?
-While it's too early to tell, it's unlikely that contractors will avoid working with Saudi Aramco entirely due to its significant market share. Instead, there may be an impetus for companies to diversify their business and expand globally.
Outlines
đ Global Jackup Market Overview and Recent Trends
The first paragraph introduces the webinar on the global jackup market, highlighting insights on how Ram Corp's rig suspension announcements may influence the market outlook. Matthew Donovan, head of the estrian rig market research team, presents an overview showing 72% of 499 global jackup units are currently drilling or contracted. The Middle East has the largest number of jackups, followed by the Far East and Southeast Asia. Utilization rates have generally increased, especially with the Middle East's demand growth. However, recent contract suspensions by Saudi Aramco, the largest operator in the jackup market, have begun to impact active rig numbers and utilization rates slightly.
đ Impact of Saudi Aramco's Contract Suspensions
This section delves into the specifics of Saudi Aramco's decision to suspend contracts for up to 12 months on 22 jackup rigs, which has led to a preservation of backlog by extending contracts. The impact on various drilling contractors is detailed, with some electing to terminate contracts rather than return after suspension. The response of rig owners includes marketing the jackups globally, with some securing long-term contracts elsewhere and others facing challenges due to regulations, technical requirements, and rig age. The market has seen a decrease in rates due to the additional availability and uncertainty.
đłïž Rig Redeployment and Market Challenges
The third paragraph discusses the challenges and strategies for drilling contractors looking to redeploy jackups outside of Saudi Arabia. It covers the need for rigs to meet new region specifications, including water depth and weather patterns, and the potential for upgrades to ensure compliance. The paragraph also touches on the competitive nature of securing contracts in new regions, with around 15 of the 22 suspended rigs likely to be competitive in the international market. Examples of rigs that have already secured work elsewhere are provided, indicating a shift in the market dynamics.
đ Global Utilization Forecast and Market Opportunities
The fourth paragraph presents a forecast for global jackup demand and utilization, expecting a pickup in 2025 after a near-term weakening due to rigs coming off contract with Saudi Aramco. It discusses the expectation that demand in other Middle Eastern countries, the Indian Ocean, Southeast Asia, and West Africa will absorb much of the excess supply. The paragraph also mentions long-term tenders and pre-tenders open in various countries and concludes that the 22 suspended units represent a small fraction of the global fleet, suggesting a positive outlook for the market.
đ Regional Market Analysis and Potential for Growth
This section provides an in-depth analysis of potential growth in various regions for jackup rigs. Southeast Asia and India are highlighted as areas with potential demand for the suspended rigs, with specific mentions of contracts secured in Thailand, Qatar, and Egypt. West Africa is also identified as a region with rising demand, offering long-term opportunities. The North Sea is noted as unlikely to be significantly affected due to its requirement for harsh environment jackups, which are not typical of those suspended by Saudi Aramco.
đĄ Key Takeaways and Future Market Insights
The final paragraph summarizes the key points from the presentation, emphasizing the suspension of contracts for 22 jackups by Saudi Aramco and the marketing of these rigs in other regions. It predicts that half of the units will likely remain in the Middle East, despite suspensions. The paragraph also anticipates that global demand and utilization for jackups will remain high, with day rates expected to flatten in the near term before increasing by 2025. The potential for further suspensions or terminations by Aramco is mentioned, along with the possibility of rigs being redeployed for gas production or to maintain production capacity levels.
â Addressing Audience Queries and Closing Remarks
The closing segment addresses audience questions about the suspensions, potential for increased demand in the Americas, and the future of day rates. It confirms that not all suspensions have begun, and some are still under discussion. The potential for more than 22 rigs to be suspended is acknowledged, but no specifics are provided. The paragraph concludes with an expectation of market recovery by 2025, with utilization and day rates returning to solid levels. The presentation is recorded for future reference, and a document with answers to audience questions will be circulated.
Mindmap
Keywords
đĄJackup Market
đĄRig Suspension
đĄUtilization
đĄSaudi Aramco
đĄDrilling Contractors
đĄContract Suspensions
đĄMarket Forecast
đĄDay Rates
đĄGlobal Supply
đĄDemand and Supply
Highlights
Matthew Donovan, head of the estrian rig market research team, presents insights on the global jackup market.
Recent rig suspension announcements by Ram cor may alter the market outlook and forecast.
Global jackup supply currently stands at 499 units, with 72% drilling or contracted worldwide.
The Middle East is the largest region for jackup supply, followed by the Far East and Southeast Asia.
Jackup market utilization has been trending upwards, with increased demand in the Middle East.
Saudi Aramco's directive to maintain crude oil production at 12 million barrels per day has led to adjustments in their jackup fleet.
Aramco plans to reduce offshore oil rigs while increasing rigs for gas projects, aiming to maintain over 300 rigs in total.
22 jackups are known to be affected by contract suspensions, with durations of up to 12 months.
Rig owners are marketing the suspended jackups globally, with some securing long-term contracts.
Challenges for drilling contractors include country regulations, technical requirements, and the age of the drilling unit.
Approximately 15 of the 22 suspended rigs are likely to be competitive in the international market.
Three out of the 22 suspended units have already secured work elsewhere, indicating a shift in the market.
Jackup day rates are expected to flatten in the near term due to increased availability and market uncertainty.
Global jackup demand is expected to pick up by 2025, with a focus on regions like West Africa, India, and Southeast Asia.
The North Sea market is unlikely to be significantly affected by the Middle East situation due to its requirement for harsh environment jackups.
Drilling contractors may use the suspension time for maintenance and repair of their rigs.
The presentation suggests that the market will return to high utilization and day rates will rise by early 2025.
Transcripts
good morning afternoon and evening
everyone uh welcome to May's edition of
the estrian rig webinar Series in
today's presentation we will be
discussing our insights on the global
jackup market and how Ram cor's recent
rig suspension announcements may change
the Outlook and forecast from esen
today's presentation will last
approximately 30 minutes and will
include some time for Q&A at the end to
ask a question please use the Q&A box at
the top panel of today's event
window to this presenters Matthew
Donovan head of the estan rig market
research team uh who is based in our
Houston
office today's presentation is being
recorded and will be uploaded onto the
estan website uh later this
week I would like night to to invite
Matthew to start today's presentation
over to you Matthew thank you Paul
appreciate it and thank you all for
joining us today for AR Co rig
suspensions shaping the future of the
global jackup
market disclaimer
first so starting off we're going to
look at the uh Global jackup Supply
overview uh the chart on the left hand
side of the screen shows Global jackup
Supply by status with 499 units
currently 72% of those are drilling or
otherwise contracted worldwide a
significant number number of the uh 133%
of rigs that are currently warm stacked
do have uh contracts
upcoming to the right hand side of the
screen you'll see jackup Supply by
region where you can see that the Middle
East uh is by far the largest area in
terms of jackups uh with the Far East
and Southeast Asia coming in second and
third but uh well below the nearly 200
units found in the Middle East at this
time going to look now at some recent
Trends in jackup demand and utilization
so in the jackup markets utilization had
been trending generally upwards what
we've seen over the past two years is
that increased demand in the Middle East
drew a large number of jackups to the
region so we had Rising demand there it
also boosted utilization globally as a
lot of the excess capacity in other
markets moved to the Middle East at the
same time as demand also picked up
slightly in some of those
regions and what we've seen is
competitive contractor utilization for
the global jackup Fleet remain around
90% since early
2023 and total utilization was as high
as
74% as of March of this year as I
mentioned earlier the Middle East
accounts for the majority of jackup
demand particularly activity in Saudi
Arabia and the United Arab Emirates what
we've seen in recent months in April and
May is the number of active Rigs and
competitive utilization have dipped
slightly in these months as contract
suspensions began in Saudi
Arabia so Saudi AR Saudi aramco the
state operator uh for Saudi Arabia is
the largest single operator in the
jackup
market in January of this year aramco
received a directive from the ministry
of energy to maintain its maximum
sustainable capacity for crude oil
production at 12 million barrels per day
reversing a previous planned increase to
13 million barrels a day that was
announced in March of
2020 so what we've seen is that uh
aramco is now adjusting its uh Fleet to
deal with this uh reversal in uh the
increase in uh maximum sustainable
capacity and that was what had fueled a
lot of the uh new rig contracts that are
around cosigned over the last several
years in March of this year arango's CEO
I mean n announced plans to reduce the
number of offshore rigs working on oil
projects while increasing the rigs for
gas projects he stated that aramco aimed
to maintain over 300 rigs including
onshore and offshore rigs together and
shifting some of those towards natural
gas
projects aramco currently has around 75
jackups under contract with another
three slated to commence work soon two
of those rigs are undergoing maintenance
while one is awaiting delivery at a yard
in the Middle
East in April Saudi aramco began issuing
contract suspensions of up to 12 months
to units that were under contract and a
total of 22 jackups are known to be
infected with suspensions spread among
drilling contractors including Addis
shelf drilling cul cipm Arabian drilling
Egyptian drilling ARA Drilling and boore
drilling we have seen multiple
suspensions already begin While others
are still under discussion and expected
to begin later in
20204 so I mentioned these are 12
subscrip suspensions of up to 12 months
for these contracts and the backlog on
these is being preserved by adding the
suspension time back to the contract as
an extension at the end once they
restart work however we have seen at
least one rig owner elected to terminate
the contract rather than return to a
ramco after the suspension the remaining
terms on some of these suspended
contracts can vary from a few months to
multiple years now in response we've
seen rig owners have already begun
marketing these jackups globally with
three already securing long-term
contracts however the additional
availability and uncertainty in the
global jackup market has resulted in
some lower rates fixed
recently and as part of these
suspensions I should note that jackups
that secure new work in other areas are
given the opp the option to complete any
of these new contracts and Associated
options before returning to work with a
ramco and you turn to the charts on the
right of the screen you can see the uh
companies impacted by the current
suspensions and the number of rigs that
were suspended and also the percentage
of rigs suspended by rig manager that
were under contract to aramco so cell
had 44% of its rigs under contract to
Aram Co suspended as did shelf Drilling
and CM close at 43% while Addis which
had five units suspended represents
around 15% of their units under contract
to a
ramco moving ahead with a look at some
of the units being
suspended um while we're expecting some
of these units to uh become active in
the global market not every jackup may
be suitable for work in every other
region there'll be some challenges for
drilling contractors wish to Market
their rigs outside of Saudi Arabia these
can include country regulations
technical requirements and the age of
the drilling unit and indeed some
contractors may have to work to expand
beyond the market they are currently
focused on if you're talking about rigs
moving to another region the jackup
specifications must align with the
requirements of that new region
including water depth and Wet Pat
weather patterns modifications or
upgrades may be necessary for some units
to ensure compliance with local
regulations and operating conditions and
securing a contract in a new region of
course depends on market demand
competition and economic factors each
region has its own set of regulatory
requirements governing drilling
operations and we estimate that of the
22 suspended rigs around 15 of those are
likely to be competitive into the
international market and some of the uh
remaining of those units May uh instead
await their suspensions in uh Saudi
Arabia or perhaps bid for similar work
in other parts of the Middle East we've
uh broken down these suspended units to
the right of the screen by their design
and by the age so you can see the
majority of the units that were
suspended were Gusto MSC CJ 46 or Kel's
b class and a number of the units uh
well number of the units relatively new
rigs delivered in the past decade we had
several quite old units uh that were
suspended now the working life of a
jackup can easily reach over 40 years so
uh some of these rigs do have uh work uh
working life ahead of them but they may
be less competitive on the global market
due to operator preference for newer
rigs this is a look at rig designs per
region of units currently
drilling we can see preference for
certain uh designs within
regions and what we've seen is that
suspended rigs are already beginning to
move outside Saudi Arabia Aris was
awarded an 18-month trilling contract in
the Gulf of Thailand from ptcp marking
its entry into its ninth country of
operations and subsequently artist has
also secured a new contract for oneye
firm term in Qatar with optional
extensions of up to 18
months uh they have also been awarded a
20 mon month drilling contract in Egypt
so with three out of the suspended unit
total 22 suspended units have already
secured work
elsewhere multiple units are already
being marketed internationally and
several of the affected drilling
contractors already have a significant
International presence it is understood
that one cm jackup will relocate likely
to Mexico where it will take over a
contract currently fulfilled by a jackup
that cpim has Bebo
charted now given the high costs of
mobilization demobilization and the
potential for new contracts to be for
terms longer than 12 months some jackups
may not return to Saudi Arabia at the
end of this so they could uh elect to
terminate their remaining uh
contract and there are units that are
more suited to the Middle Eastern
markets they remain stead bid on work in
other parts of the region or remain uh
suspended until resuming work with ar
ramco and we do know that some drilling
contractors intend to use the suspension
time uh to let their rigs undergo
maintenance and
repair looking at Global utilization
forecast we are still expecting jack up
demand globally to pick up in
20125 after some near-term weakening as
rigs come off contract with Saudi aramco
and bid on new jobs drilling contractors
largely expect demand in other countries
of the Middle East in addition to the
Indian Ocean southeast Asia and West
Africa to absorb much of the excess
supply of rigs suspended by
aranco uh we currently have long-term
tenders and pre- tenders open for work
in countries including Qatar Malaysia
India Nigeria and
Angola and we expect Global competitive
utilization to remain strong due to the
pent up demand in these other areas and
the small number of suspended units in
terms of global Fleet size the 22 units
represent around
4.4% of the total Global Fleet so we are
expecting uh a significant number of
those to secure work in other areas
going forward now on a long ter frame
the possibility remains that ramco could
suspend further rigs or terminate
contracts towards the end of the
suspension periods rather than resume
work however this is medicated by the
state oil company's plans to increase
gas production which will allow some
rigs to be redeployed uh to that work
and also the work needed to maintain the
12 million barrels per day uh maximum
sustainable capacity levels so we are
expecting uh Demand by 2025 to have
picked up
again looking at our Global jackup day
rate forecast we are projecting some
near-term flatness in as we go forward
and as as drilling contractors work to
secure additional contracts in a short
time frame we've seen some jackup
contracts fixed at the lower end of
recent day rate ranges however other
recent fixtures have remained close to
the Leading Edge of day rates that were
achieved in early
2024 so the increased availability and
Market uncertainty in the near term
expected to cause some flattening in
jackup day rates as that excess capacity
is absorbed we expect jackup rate to
begin Rising again due to the overall
strong utilization and general limited
Supply globally so by 20125 we should
expect to see some increases in uh
jackup day
rates and we'll turn now to some other
regions um we're expecting demand in
Southeast Asia and India to draw some
more jackups in that's been southeast
Asia has been identified by several
drilling contractors as a potential
market for the suspended rigs to secure
work and the weather conditions and
water depths mean that many jackups in
the Middle Eastern Market could be SED
suited for work in parts of Southeast
Asia as I mentioned earlier arst has
already secured an 18-month contract for
one of their units that was suspended
with pttp offshore Thailand and they
have cited an existing vacuum in very
attractive Southeastern Asian Southeast
Asian markets as a potential place for
their rigs to move we're seeing
long-term jackup require ments in
Thailand Malaysia and Indonesia with
start dates in late 24 and into
2025 and outside southeast Asia India is
also an important jackup Market that
could potentially bring in rigs OMC has
had an open tender for four jackups
though many of these are likely to go to
incumbent Rigs and the company recently
canell a three-year tender for an hpht
uh unit there's currently also an oil
India tender in progress and Market
sources indicate that can oil and gas
can oil and gas India will issue a
letter of award for two jackups in the
near
future moving now to West Africa we are
expecting jackup demand to rise in West
Africa there are currently long-term
opportunities for jackups in Nigeria
Angola and equ Equatorial Guinea and
also shorter term jobs possible in areas
including Ghana Cameroon and the Congo
this potential work includes exploration
a development drilling as well as
boosting production from mature
assets and we've seen that drilling
contractors with suspended rigs
including shelf Drilling and B drilling
already have extensive operations in
West
Africa recently valaris fixed a jack up
to a 13 well contract in Angola and this
unit will be mobilizing from the US Gulf
of Mexico for this job which indicates a
general willingness to move rigs into
West Africa for
work also worth mentioning that many
smaller operators in West Africa are
very sensitive to price escalations in
terms of day rates so a near-term
increase in availability could provide
some opportunities for these companies
to uh work on projects that would not
otherwise go ahead if they were bidding
at higher day
rates look at the North Sea the North
Sea Market is unlikely to be
significantly affected by the situation
in the Middle East
this is because the North Sea Market
requires harsh environment jackup so the
rigs released by Saudi aramco are very
unlikely to move to the North Sea for
work what we have seen in recent years
jackups left the North Sea for other
regions including West Africa southeast
Asia oania and Latin America and
suspended rigs from uh from the Middle
East finding work in other regions could
reduce future movement of jackups from
the North Sea with the recent departure
of two jackups the fleet in the North
nor sea in the Russian Arctic is down to
34 jackups and this reduced Supply and
increased Contracting uh in recent
quarters has resulted in a tight Market
with limited availability in the near
term momentum in the North Sea jackup
Market picked up in late 2023 and early
2024 with around eight years of backlog
added in 2024 to date and we've seen
competitive contracted utilization in
the North Sea jacket Market has been
around 90% over the last 4 months
we're expecting demand in Norway to
remain stable with all eight units in
the region currently firmed through 2025
and the remaining active UK Fleet is
sold out through 2024 with several rigs
transitioning to higher rates during the
year and around half of the UK Fleet
contracted into mid
2025 looking now some key takeaways from
uh this presentation today mention Saudi
aramco is suspending contracts for 22
jackups these current
suspensions last up to 12 months
suspended jackups already being marketed
and securing work in other
regions uh although we do expect around
half of the units to likely remain in
the Middle East Middle East even with
these suspensions Remains the primary
market for jackups but we are expecting
uh contract contractors are expecting
demand in West Africa India and
Southeast Asia to absorb much of the
additional excess Supply in the jackup
market by
2025 we're expecting Global demand and
utilization for jackups to remain high
over the coming
years but we do expect day rates to be
flat in the near term due to that
availability in the global
market right it's been a presentation
today so I believe now we have some time
for uh questions from the
audience thanks Matthew um again if
anybody's got any questions please use a
Q&A box at the the top of the uh the top
of the screen um we did get a couple of
questions coming actually um just very
early on before the presentation started
on on the suspensions have all of the
suspensions actually begun at this time
uh no not at this time Paul so several
have already begun and we've seen rigs
move into Anchorage in uh parts of uh
Saudi Arabia and outside uh the area in
the Middle East uh so those some have
already begun but there are some that
are still under uh discussion for the
exact terms of the suspension and timing
and so what we're seeing is uh probably
most of those suspensions to uh Begin by
uh the end of the second or into the
third quarter of 2024 so so we're
expecting most of these suspensions to
begin by the end of this year but not
all have done so at this
time okay um you obviously showed quite
a few detailed slides on sort of the
regional demand broken down but uh one
question came in is is is there
potential for increased jackup demand in
the
Americas well if we look at Americas as
a whole I mean there is a uh we are
expecting at least one of the units that
was suspended uh to move to Mexico where
it'll be replacing rather than uh
additional demand to it but in general
the Americas is quite a small market for
uh jackups uh there's only a handful of
jackups active in the US Gulf of Mexico
uh at this time and as I mentioned one
of those is already secured work in West
Africa and uh will be leaving uh for
work uh in in West Africa in the near
future so unlikely to be additional rigs
brought in uh for the US Gulf of Mexico
uh there is some potential for rigs to
go to Central America or the
Caribbean uh South America again quite a
small market for jackups uh We've
recently had a unit move from the uh
North Sea uh to uh Argentina for a
project specific project there and we've
also seen uh Petr brass is um has tended
for a jackup for PNA work uh in Brazil
so that's a specific project that there
that could bring in but in general uh
not probably not one of the major
regions for rigs to relocate to as
compared to uh Asia or Africa that's the
more likely market for uh for
jackups this time
I think you know the
um really the sort of the major Focus o
of uh not just the units that are on
suspension but also any units that are
available available in general has been
the potential for increased demand in uh
southeast Asia and West
Africa as uh bigger sort of uh areas
where potential growth Could Happen um I
say in those regions you know a lot of
excess you know when demand started to
pick up in the Middle East uh a lot of
rigs that were in other areas were
brought very quickly to to the Middle
East for work in in Saudi ramco so
utilization in uh these other regions uh
really tightened up so uh there's you
know now possibility of some those to
move back there or or you know move to
move to another region and I think also
you know there are a uh around 17
jackups still under construction at this
time so uh also potential for some of
those units as they deliver to enter the
market in Southeast Asia or
Beyond likely some of these walls some
of the units under construction are
being built in the Far East and may
instead work into the Far Eastern
Market there any further questions
Paul a couple pH couple more just coming
through I know we've got just a couple
of minutes left before we we s question
um one question there do you foresee uh
more than 22 Rigs being suspended is
there more out there that we've hearing
that's the that's the number that's sort
of been uh been announced at this time I
mean I think there is the you know
depending a lot of this is going to
depend on how Saud Saudi aramco arejust
going forward uh they contract they have
a lot of rigs under contract so you know
there there is maybe the potential in
coming years that we could see some more
suspensions or possibly that you know at
the end of this 12 months uh there is
the possibility that a ramco may decide
that they don't need to uh uh bring
these rigs back into the market so we
could see a mix of uh further
suspensions or or terminations but uh at
this time it's it's it's kind of list
has come out at around 22 so you know
further further act further uh
suspensions would you know that'd be
speculative this time but certainly
possible
okay um just picking on day rates we had
a few comments and questions coming
through about day rates so our forecast
is flattening and then expecting to
increase in yeah so what we've yeah we
we we're seeing some near-term
flattening um basically as uh you know
just as an unexpected boost in
availability and also uh contractors
working hard to
secure uh secure contracts uh for the
units that have come up you know
unexpectedly available so they're
working to sort of secure market share
on those so we've seen a little bit of a
some lower day rates and also Market
uncertainty tends to um Hal upward
movement in day rate slightly so I think
we'll see a little bit of effect of that
this continuing this year but in general
there's quite High utilization still and
a lot of demand out there for a fairly
limited supply of of uh jackups so I
think we should expect to see uh rates
start to pick up again uh you know sort
of
2025
okay interesting question around sort of
the the ramco and their controlling of
the market do you think drilling
contract is how they will perceive the
suspension going forward that there will
be S more reluctant to to to offer work
into the Middle East or stay away from
Iran cour Tenders in the future I's too
big a player I I think that's that's
that's a very large you know that's a
very large portion of the market and I
don't think anybody's going to uh put
off you know being in that what I think
you instead you might see is that some
companies may be this may be an impetus
to uh expand uh their businesses rather
than uh rather than shunning a rather
than shunning a large Market I think
it's more that you know uh I might see a
bit of
diversification uh in where companies
have their fleets um multiple drilling
contractors already work in you
know many many regions around the around
the globe and uh I think maybe perhaps
you'll see some Middle East focused ones
continue to expand uh their presence
globally okay rather than anybody
staying from uh from uh ramco in general
that that seems
unlikely okay so so I was I was summary
is uh we we believe this is a short
shortterm blip in the market for
utilization day rates and we expect the
Market to return
to early 2025 is that I well I I think
by 2025 we should start to see yeah we
should start to see much of the uh
excess Supply absorbed uh by
2025 um you know you know and and then
so we'll and then we'll see utilization
um remain
solid and forth okay well I'm conscious
of the time now that we're coming there
we we've still got quite a lot of uh
questions um what we will do for those
people unfortunately we haven't got time
to answer them all today we'll Reach Out
directly um to everybody um we have had
quite a lot of comments about today's
presentation obviously a topic that
everybody's interested in so what we
what we'll also do this time which is
the first is we we'll also send out a
document um of the questions that have
being asked and our answers so rather
than just to the individual we'll send
it to the whole audience so you can hear
some more of our intake what's going on
so um again that really concludes
today's presentation um I would like to
thank everybody for attending uh Matthew
for presenting some great great
information some great insights and um
as I mentioned earlier this is being
recorded and we will send the link out
uh in the next couple of days of the
website where you can follow up on the
information and then look forward to the
uh question answer document we'll send
out over the next couple of days so
again thank you for everybody and uh
enjoy the rest of your day thanks thank
you everybody appreciate you joining us
thank you
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