A United Kingdom-based exploration company, Dolphin Drilling has secured a $96 million contract to provide a drilling rig for an oil asset in offshore operations in Nigeria.
According to the offshore drilling company, the charter deal with Nigeria-based General Hydrocarbons Limited (GHL)will see the Blackford Dolphin rig start operations this quarter.
Reports showed GHL has chartered the rig for up to 12 months, although it has the option to end the deal after six months.
“We are proud to announce the final award of the Blackford Dolphin contract, proving our position in the niche moored semisubmersible market,” Bjornar Iversen, chief executive at Dolphin Drilling said.
The Blackford Dolphin is a semi-submersible drilling rig of an Enhanced Aker H-3 design built in 1974. The rig is a large structure with facilities to extract and process petroleum and natural gas that lie in rock formations beneath the seabed.
He added, “Dolphin Drilling has attractive assets, a strong team and a solid platform to leverage on the favourable market development with improved rates.
“The contract for Blackford Dolphin underlines the potential of the company and its assets, and we believe Dolphin Drilling will capitalise on the continued expected tight rig market for the rest of the fleet,” Iversen said.
Dolphin Drilling said the semi-submersible rig will mobilise to Las Palmas for its special periodic survey ahead of starting operations in Nigeria, having recently completed work in the Gulf of Mexico for Mexican state oil company Pemex.
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Oyinkepreye Orodu, head of the department, of Petroleum Engineering at Covenant University, said Nigeria could gauge the prospect of an increase in future production and the level of current investment in the sector with the rig number.
“The oil rig number reflects or signifies ongoing exploration activities, and field development scenarios which may involve various good intervention schemes to boost production or drilling new infill wells to further improve oil recovery,” he said.
In the first ten months of 2022, Nigeria has no new exploration acreage. According to Rystad Energy, Angola, Morocco, Egypt, and Zimbabwe are the only African countries to award new exploration acreage in 2022.
Data from the Organisation of the Petroleum Exporting Countries’ September 2022 Monthly Oil Market Report also revealed that the country’s oil rig count dropped to 10 in August 2022, from 16 recorded in 2019.
Nigeria’s oil woes did not stop at the rigs and exploration as its output also dropped to the lowest in the year and in 32 years.
The country’s oil production fell by 112,000 barrels per day (bpd) to 972,000 bpd in August from 1.08 million bpd in July, based on direct communication. The largest economy in Africa sits behind Angola (1.18 million bpd) and Libya (1.12 million bpd), according to OPEC’s secondary sources.
Experts blamed the development on the country’s insecurity issues and the move towards greener energy.
“With the challenges of security, oil theft, decarbonisation efforts and the lack of assurance for drilled wells to produce and ensure delivery to export facilities, investor confidence has dropped over the years and further reflected in low rig counts in Nigeria,” said Etulan Adu, an oil and gas expert.
