Seadrill considers the market for deepwater rigs, in depths of 7,500 feet, in Africa to be the next growth sector in drilling services.
The sharp increase in drilling is expected, among other places, off the shores of Angola and Nigeria. This is mainly due to the current backlog these areas are experiencing. In addition, it also expects the exploration activities for Tanzania, Mozambique and Kenya to increase Africa’s total demand.
Another area that Seadrill expects higher demand for deepwater rigs is the frontier areas off Brazil.
Mexico’s temporary drilling slowdown will soon be reversing and placing further demand pressure on deepwater rigs. Harsh environment drilling rigs are in significant demand as well, especially in Russia and Norway.
The gap between lack of supply and increase in demand is widening for high-end jackups as well. The jackups operate in water depths of 350 feet. The lower supply and higher demand have resulted in higher day rates and longer contracts.
It is estimated that more than thirty rigs have exited the market, this places pressure on supply and day rates. More supply issues will arise as the current global fleet ages. Currently 60% of the global fleet is in excess of 30 years old.