Seadrill and Mermaid Maritime said their joint venture company has secured three-year extensions on their two jack-up drilling rigs at day rates that are “materially” lower than market rates, with Saudi Aramco.
Owned by Asia Offshore Drilling (AOD), the AOD II and AOD III rigs will pull in expected revenue of US$98 million and $101 million respectively, the two companies said in separate statements.
The previous contracts were scheduled to expire on April 14 2020 and Dec. 31 2019 respectively.
Meanwhile, Mermaid cautioned that the day rates for the rigs are materially lower than previous year’s day rates, reducing earnings contribution for the company over the three-year extension period.
AOD owns three jack-up drilling rigs, which includes AOD I, which has also been hired by the same client. Mermaid has a 33.76 per cent equity stake in AOD and the remaining 66.24 per cent equity is owned by an affiliate of Seadrill Limited.