Strengthening Valaris' Fleet With the Acquisition of Two New Drillships.

Strengthening Valaris’ Fleet With the Acquisition of Two New Drillships.

Written by Paulo Nogueira

Published on 21/12/2023 at 11:59

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Valaris Limited Exercised Purchase Option and Received Two Drillships from DSME. Now Ready for Mobilization and Contracting. New Contracts Soon.

The offshore drilling contractor Valaris Limited acquired two new drilling units from Daewoo Shipbuilding & Marine Engineering (DSME) after opting to purchase them.

Valaris had the option to acquire two newly built drillships, Valaris DS-13 and Valaris DS-14, by the end of the year from a shipyard in South Korea. In March 2021, the offshore drilling contractor reached an agreement with DSME to modify the contracts, seeking to postpone the delivery of the drilling units.

Valaris Announces Financing Agreement for Drillship Acquisition

In August 2023, Valaris Limited and its wholly-owned subsidiary, Valaris Finance Company LLC, announced a price of US$ 400 million increased the private placement of additional second lien notes with senior secured guarantee of 8.375% maturing in 2030. The net proceeds from the offering are expected to be used to finance the purchase of the two drillships from DSME.

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Details of DSME 12000 Drillships

Both drillships are from the DSME 12000 design. The final payments for Valaris DS-13 and Valaris DS-14 were estimated at approximately US$ 119 million and US$ 218 million, respectively, assuming a delivery on December 31, 2023.

According to Valaris, these newly built drillships were acquired for an aggregate purchase price of approximately US$ 337 million. The Valaris DS-13 and DS-14 will be mobilized from South Korea to Las Palmas, Spain, where the rigs will be stacked until contracted for work.

Statement from Valaris President on the Acquisition

Anton Dibowitz, President and CEO of Valaris, commented: ‘We are very pleased to add these two high-specification platforms, the remaining drillships in South Korean shipyards, to our fleet. These additions increase our fleet of drillships to 13 rigs, reinforcing its position as one of the most technically capable in the industry.’

Financial Impact and Future Projections

Additionally, the purchase of the rigs is expected to increase the company’s capital expenditures in Q4 2023 by approximately US$ 355 million, representing the purchase price of the rigs and the costs associated with their preparation for the move from South Korea to Las Palmas. Furthermore, Valaris forecasts capital expenditures for 2024 of around US$ 35 million, primarily related to mobilization costs.

Dibowitz added: ‘Following the successful contracting of six of our stacked drillships since mid-2021, the purchase of Valaris DS-13 and DS-14 increases our operational leverage to the attractive ultra-deepwater floater market.

Contracts Portfolio Expansion

‘Based on our positive market outlook, increasing future demand, and strong customer interest in these rigs, we believe the acquisition of these high-specification drillships at attractive prices will generate appealing returns.’

Valaris revealed a plethora of new contracts and extensions in its fleet status report as of November 1, 2023. This involves business for four floaters and five jack-ups with TotalEnergies, Petrobras, ExxonMobil, Eni, BP, TAQA, and Perenco, allowing the rig owner to operate in Brazil, Angola, Mexico, Trinidad, Indonesia, the Netherlands, and the United Kingdom.

Thanks to the new series of rig agreements with an associated contract portfolio of about US$ 480 million, excluding fixed payments such as mobilization fees and capital reimbursements, the company’s total contract portfolio increased to US$ 3.2 billion at the end of October 2023.

Strengthening Valaris’ Fleet With the Acquisition of Two New Drillships.

Valaris Limited Exercised Purchase Option and Received Two Drillships from DSME. Now Ready for Mobilization and Contracting. New Contracts Soon.

Valaris Announces Financing Agreement for Drillship Acquisition

Details of DSME 12000 Drillships

Statement from Valaris President on the Acquisition

Financial Impact and Future Projections

Contracts Portfolio Expansion

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Strengthening Valaris’ Fleet With the Acquisition of Two New Drillships.

Valaris Limited Exercised Purchase Option and Received Two Drillships from DSME. Now Ready for Mobilization and Contracting. New Contracts Soon.

Valaris Announces Financing Agreement for Drillship Acquisition

Details of DSME 12000 Drillships

Statement from Valaris President on the Acquisition

Financial Impact and Future Projections

Contracts Portfolio Expansion

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