Shelf Drilling has announced its Perseverance jack-up rig will depart the North Sea for a $73 million (£58.3m) contract in Vietnam.
The Dubai-headquartered rig operator said the Perseverance, which is currently moored in the Cromarty Firth, will commence its move to Southeast Asia shortly for the 16 month contract with state-owned PetroVietnam.
Perseverance is expected to commence work offshore Vietnam in the third quarter of 2024.
The rig (formerly the Noble Hans Deul) has been moored in Cromarty Firth after troubled North Sea operator IOG suspended its drilling plans and cancelled its contract with Shelf Drilling in June.
North Sea rigs ‘exodus’
The departure of the Perseverance marks the latest example of rigs departing the North Sea for more lucrative opportunities elsewhere.
The decision by the UK government in November last year to increase its Energy Profits Levy (EPL) to a headline tax rate of 75% has amplified the North Sea rig “exodus”, according to analysis by Westwood Global Energy Group.
Westwood said in March that the market is now 40% leaner than it was in 2017, with rigs leaving for regions like Australia, Canada, Africa, Mexico and the Middle East.
In September, the chairman of the North Sea chapter of the International Association of Drilling Contractors Darren Sutherland told Energy Voice market conditions in the UK are becoming “financially untenable” for many firms.
Mr Sutherland said the UK government is not doing enough to stop rigs leaving the North Sea, and warned it could impact emerging sectors like carbon capture and storage (CCS).
“The North Sea supply chain needs to be able to see a future here, otherwise companies will invest in regions where they will get a better return,” he said.
“We need to see a longer-term vision for the North Sea with a stable fiscal regime to make it more attractive for businesses to invest here.”
Southeast Asia emerging drilling hotspot
While Middle East demand for rigs is slowing, jack-up rig operators Shelf Drilling and Borr Drilling have highlighted increasing interest from Asia.
Meanwhile, Houston-based drilling contract Valaris is seeing a return of “longer duration opportunities” in Malaysia, Thailand and Vietnam.
Analysis from Westwood earlier this year shows offshore rig day rates “surging” and utilisation levels not seen since the oil price crash of 2014.
Meanwhile, although many North Sea opportunities are in the ‘doldrums’, new opportunities are emerging.
Decommissioning and CCS opportunities have kept two Valaris jack-up rigs in the region in 2024.
The Valaris 123 won a six-well contract with Taqa on the Porthos CCS in the Netherlands while the Valaris 72 will take on a 55-well decommissioning deal with Eni over four years.