Odfjell Drilling has struck a deal with John Fredriksen’s SFL Corporation to provide management services for the harsh environment jackup drilling rig West Linus.
The rig was delivered in 2014, and is currently operated by a subsidiary of Seadrill and employed on a long-term drilling contract with ConocoPhillips Skandinavia in the North Sea until the fourth quarter of 2028.
The change of operational management from Seadrill to Odfjell will take place as soon as regulatory approvals such as the change of duty holder under the acknowledgment of compliance is approved by Norwegian authorities, expected no later than October 1, 2022.
The bareboat charter rate from Seadrill in this transition period will be approximately $55,000 per day. Upon effective assignment of the drilling contract, SFL will receive charter hire from the rig and pay for operating and management expenses. Under the contract, the rig is earning a market adjusted rate, which is based on market developments for similar jackup rigs in the North Sea and is adjusted on a semi-annual basis. The current day rate and remaining contract length imply a charter backlog of around $500m, SFL noted.
Simen Lieungh, CEO of Odfjell Drilling, said: “Today we are engaged in platform drilling operations for ConocoPhillips in the Greater Ekofisk Area. The addition of the West Linus management contract will strengthen our long-term co-operation.”