Flotel specialist Prosafe expects a good long-term demand for its accommodation rigs, with growth in activity in the North Sea from spring 2011 and in deepwater regions. Meg Chesshyre reviews recent developments at the world’s leading owner and operator of semisubmersible accommodation rigs.
Headquartered in Larnaca, Cyprus, and listed on the Oslo Stock Exchange, Prosafe owns 11 out of the 19 semisubmersible accommodation rigs worldwide comprising five out of eight anchored rigs, and six out of 11 DP rigs. The company achieved a rig utilisation rate of 84% in 4Q 2009, 86% over the full year. This was slightly down on 2008 utilisation, because the MSV Regalia underwent a major refit in the first half of 2009. A NKr500 million bond issue was also completed. Operating profit reached $218.6 million in 2009. The company, which operates globally, employs 385 people.
Prosafe president and CEO Arne Austreid says they are comtemplating upgrading the semisubmersible Safe Caledonia for a further 15-20 years of North Sea operations, at an estimated cost of about $100 million, but that decision will not be taken until the end of this year, with the work to be carried out 2011/12.
Within the harsh and semi-harsh offshore environments where most of Prosafe’s accommodation rigs operate, there is a good supply-demand balance and the number of newbuilds to be delivered over the next few years is limited.
In the North Sea, the majority of the fixed installations is mature and requires greater maintenance and modifications to uphold production and safe operation. Increased recovery and tie-ins of satellite fields to existing installations have extended the lifetime for many fields in the North Sea, implying a good outlook for modification and maintenance projects over the coming years. Austreid says that new projects were slightly postponed in 2009, but that Prosafe has observed that tendering is restarting. Prosafe has identified several specific North Sea projects needing accommodation in 2011/12.
The service jackup Safe Esbjerg, which is operating for Maersk Oil & Gas in the Danish North Sea until June 2011, is currently undergoing a 60-day refit at a shipyard in Poland including a ‘special period survey’ SPS in addition to some refurbishment and steel work. In the UK sector, the DP Safe Caledonia is operating for Total until September 2010. The anchored Safe Bristolia, which was operating in Mexico until the end of January 2010, is mobilising to the North Sea to begin a contract for Nexen in April this year.
In the Norwegian sector, MSV Regalia started operation for BP Norge at the Valhall field on 12 July 2009 following a six-month refit. BP exercised a six-month option starting in January 2011 for the continued use of the Regalia, plus a four-month and two-month option taking the unit until the end of 2011. Safe Scandinavia currently anchored at Invergordon having completed a 65-day contract with Shell UK in the beginning of October 2009, has a firm contract with Statoil in Norway, for six months starting early May and six months beginning early April 2011.
The market for semisubmersible accommodation rigs continues to be good in Mexico, where Pemex has high activity levels offshore in order to keep up production from the Cantarell field. Five of the company’s rigs are bareboat chartered to Interpetroleum Services, operating for Pemex offshore Mexico. The contract for the DP Safe Lancia has been extended until the middle of this month at an unchanged day rate, with a bid process under way for a longer term contract. The DP Safe Concordia completed its assignment in Mexico early October and, following an SPS, is being marketed for new employment.
Prosafe’s only unit in Southeast Asia, the anchored Safe Astoria, started a contract for Shell in the Philippines last October. Shell has exercised a 30-day option starting next month for the continued use of the unit, and there is a further 30 day option.
In addition to the established North Sea and Gulf of Mexico markets, Austreid sees potential growth regions for semisubmersible accommodation rigs in Brazil, West Africa (in deeper waters) and Southeast Asia (particularly in the cyclone season) and Australia. Some of the installations on the Brazilian shelf are becoming mature and in need of maintenance. New developments off Australia are also likely to need hook-up support.
He sees rates of around $200-250,000 for the semisubmersible units in the North Sea as a reasonable level going forward. The Norwegian sector MSV Regalia extension achieved a rate of $242,000. The Gulf of Mexico rates are bareboat, and currently varying between $48,000 and $85,000. OE