Brazilian state-owned oil and gas company Petrobras has awarded a drilling contract worth approximately $519m to Valaris for the Buzios oil field project.
The contract for the VALARIS DS-4 drillship, spanning 1,064 days, is set to commence towards the end of Q4 of 2024.
It includes mobilisation fees and additional services.
Valaris said the commencement of the new contract with Petrobras is scheduled after the completion of the drillship’s current engagement, which is expected to conclude in September 2024.
Following this, the VALARIS DS-4 is anticipated to undergo a 90-day period of out-of-service time to undertake necessary capital upgrades as specified by the customer before it begins its new assignment.
Located in the pre-salt Campos Basin off the coast of Brazil, Buzios is one of the world’s largest deep-water fields.
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Discovered in 2010 and brought into production in April 2018, the Buzios field is owned and operated by Petrobras.
Valaris president and CEO Anton Dibowitz said: “We are delighted to have secured further work for drillship VALARIS DS-4 with Petrobras for their upcoming Buzios programme and we look forward to continuing to partner with Petrobras on their programmes offshore Brazil, a market where we expect to see continued growth over the next several years.
“We have previously stated that we expect Valaris’ earnings and cash flow to increase meaningfully as rigs are recontracted at market rates. This contract award for VALARIS DS-4 is a great example of how we are executing on the operating leverage inherent in our business, with the rig repricing from a day rate in the low $200,000s to an effective day rate in the high $400,000s.”