Valaris wins $120m in deals and gets rid of four stacked rigs

New York-listed offshore driller Valaris has won several deals and contract extensions for its jackup rig fleet and revealed its plans to rid itself of four rigs.

The company won a 600-day priced contract extension with TotalEnergies in the UK North Sea for the 2011-built Valaris Stavanger. The extension is expected to begin in the third quarter of 2025 in direct continuation of the current program. The total contract value for the priced extension is over $75m.

Work under the initial contract with TotalEnergies started in May 2024 and will end in June 2025 when the extension will kick in.

The 2001-built Valaris 249 was awarded a 100-day contract with BP offshore Trinidad. The contract is expected to begin in the first quarter of 2026 in direct continuation of the rig’s previous program with another operator. The total contract value is approximately $16.8m.

Following the BP deal, the rig will start work with Shell in June 2026. The deal is supposed to last for a year and end in June 2027. Shell has three priced options with an estimated duration of 50 days each.

The 1998-built Valaris 247 was awarded a one-well contract with Jadestone Energy offshore Australia. The contract will start in March 2025 in direct continuation of the rig’s current program with Eni.

The deal with Eni started in December 2024 and will end in March 2025. The rig is working on a $180,000 dayrate.

BP exercised a two-well priced option for the 2005-built Valaris 106 in Indonesia. The option period has an estimated duration of 80 days and is expected to begin in May 2025 in direct continuation of the existing firm program the rig has been working on since January of last year. The operating day rate is $95,000.

The company also agreed to short-term bareboat charter agreement extensions through February 28 for the Valaris 116, Valaris 146, and Valaris 250 jackups, which are leased to ARO Drilling. Valaris and ARO are negotiating with Saudi Aramco regarding longer-term contract extensions for these rigs.

The new contracts and contract extensions have an associated contract backlog of around $120m. The company’s total contract backlog decreased to around $3.6bn from approximately $4.1bn as of October 30, 2024. The backlog excludes lump sum payments such as mobilization fees and capital reimbursements.

The offshore driller also decided to retire three semisubs from its fleet – the Valaris DPS-5 which has been idle since last working in the third quarter of 2024 as well as the Valaris DPS-3 and Valaris DPS-6, which have been stacked for several years. The company stated that the rigs would either be repurposed for alternative uses outside the drilling sector or scrapped.

Another rig left the Valaris fleet following a $24m sale. The 25-year-old jackup Valaris 75 which has been stacked in the US Gulf of Mexico for five years. As part of the purchase and sale agreement with an undisclosed client, future operations are restricted to the Gulf of Mexico.

“We are committed to prudently managing our fleet and will retire or divest rigs when the expected future economic benefit for an asset does not justify its costs. Consistent with this approach, we have decided to high-grade our fleet by retiring three semi-submersibles for which we see limited attractive, long-term contract opportunities, as well as selling the Valaris 75. These actions reduce costs for idle rigs, benefit our cash flow and further focus our fleet on high-specification assets,” said Anton Dibowitz, president and CEO of Valaris.