Oil and gas decommissioning firm Well-Safe Solutions has acquired a second rig in a move it claims will spark the creation of about 100 new jobs.
The Aberdeen-headquartered company has bought the West Epsilon jack-up rig, built in 1993, from Seadrill and renamed it “Well-Safe Protector”.
The fee was not disclosed, but the firm said the purchase and subsequent upgrade work would run into tens of millions of pounds.
Costs will be covered using “existing funds within the business”.
Well-Safe bought its first asset, the Well-Safe Guardian semi-submersible, from Diamond Offshore in April 2019.
Chief executive Phil Milton said the addition of the second rig meant the company would be able to plug and abandon (P&A) a greater number and variety of wells.
Mr Milton also said the creation of around 100 new jobs would come as “welcome news” to the industry at a time of “great uncertainty”.
Eighty of the new jobs will be based offshore, while most of the 20 new onshore positions will be in Aberdeen.
Some of the upgrade work on Well-Safe Protector will take place in Norway.
The process will be completed in the UK at a location which has yet to be determined.
The firm’s first rig, Well-Safe Guardian, was taken to Global Energy Group’s Nigg Energy Park for a refurbishment programme which has been delayed by the Covid-19 pandemic.
However, Well-Safe expects both of its units to be ready for deployment early next year.
Mr Milton said that by investing heavily in its fleet the business was bucking the current industry trend for retiring and cold-staking rigs.
Well-Safe was launched in mid-2017 by a trio of oil and gas industry stalwarts – Mark Patterson, Alasdair Locke and Paul Warwick.
Scottish Enterprise and Well-Safe’s major shareholders provided funding to get the business up and running.
The company has continued to attract investment. Last October a consortium led by MW&L Capital Partners – launched in 2018 by leading City bankers Matthew Westerman and Julian Metherell – pumped in £66 million to fund the next growth phase.
At the time of its launch, the firm announced ambitious plans to invest £200m in assets and grow its headcount to 400 in three years.
It currently has 80 employees, of whom 50 are in Aberdeen and 30 are offshore.
Well-Safe has yet to clinch a first P&A contract for Well-Safe Guardian, but Mr Milton is “confident” of securing work soon.
He said 2021 would bring some “great opportunities” for both Well-Safe Guardian and Well-Safe Protector, and that 2022 and beyond is “looking even busier, with a significant increase in activity forecast”.
Last month, Oil and Gas UK (OGUK) said forecasts for North Sea decommissioning spend in 2020 and 2021 had been cut by about half a billion pounds due to the Covid-19 outbreak and crude price slump, which have led to project deferrals and reduced budgets.
But OGUK said expenditure would still exceed £1 billion in both years, with an uptick expected in 2022.
The Oil and Gas Authority and trade body Decom North Sea are both trying to convince the UK Government to support proposals aimed at providing financial stimuli for well P&A work.