Rigs report: global jack-up drilling hits yearly high in volatile oil market

Brent crude oil appears to have settled into a trading range of between US$60 and US$65 per barrel. Oil was up fractionally by US$0.24 to US$62.98 per barrel at 4:03 GMT on 7 April, driven by an improving outlook for Covid-19 vaccinations and falling crude inventories in the US. While President Biden announced that vaccinations will be open to all adults as of 19 April, this news was balanced by increasing infections in some US states, threatening to slow the economic recovery.

Additionally, other countries in Europe and Asia continue to see rising infections.

“Oil prices shifted from gains to losses and back this morning as concerns over Covid-19 infections and US fuel stocks battle against positive financial data,” said Rystad Energy oil markets analyst Louise Dickson. “The number of new Covid-19 infections continues to rise and set new records in several countries around the world, such as India, a major oil consumer. US cases are also on the rise, affecting the market.

“For the oil market to recover, the world needs further progress in fighting the pandemic, a slowing infection count and a gradual withdrawal of lockdowns and restrictions.

“Oil prices are understandably held back from robust growth until the needed pandemic breakthroughs are in place,” noted Ms Dickson.

Westwood Global Energy’s RigLogix reported the contracted global offshore jack-up fleet rose to 330 – its highest level of 2021 – led by 25 active units in the North Sea and 29 in southeast Asia – also both yearly highs. Week-on-week, jack-up drilling activity was up one unit. Deepwater activity remained stable, with 111 floaters drilling globally.

Source: Westwood Global Energy/RigLogix 6 April 2021

This month, Maersk Resolute will perform well maintenance and drill a side-track of the A9 well at the P9 Horizon field in the Dutch North Sea. The harsh-environment jack-up will be deployed for about 45 days under the US$4.5M contract from Petrogas E&P Netherlands.

Prior to deployment, the Gusto-designed MSC CJ50 rig will be equipped with a high-efficiency selective catalytic reduction (SCR) system which uses ammonia injection to convert NOx into harmless water and nitrogen, expectedly reducing NOx emissions by up to 98%. The design will include an advanced control interface between engines and SCR units.

Noted Maersk Drilling chief operating officer Morten Kelstrup, “Operations in the Dutch North Sea come with a strict focus on protecting the environment, and we fully support this as part of our ambition of providing responsible drilling.” Maersk Resolute originally completed an extreme extended reach well at P9 Horizon in Q3 2019.

Under a framework agreement with Aker BP reached in 2017, Maersk Drilling reported it had been awarded a contract for Maersk Reacher to assist with well intervention, stimulation and accommodation at the Valhall field offshore Norway. The contract will start in July 2021 lasting 270 days. The firm contract value is approximately US$33.4M. The contract contains options to add up to 90 days of additional intervention work at the Valhall field.

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