Awilco swings to loss in third quarter

WilPhoenix rig / Image source: MaxPixel – Shared Under CC0 license

North Sea drilling contractor Awilco Drilling sank to a loss during the third quarter of the year as its revenues tumbled compared to the year-ago period. The driller expects higher rig utilization levels in the next two years. 

The driller on Tuesday posted revenues of $3.2 million for the third quarter of the year compared to $32.4 million in the same period last year.

During the third quarter 2018, the driller sank to a net loss of $10.2 million from a profit of $14.2 million in the year-ago period.

In the third quarter 2018 Awilco Drilling had rig operating expenses of $7.2 million compared to $8.1 million in 3Q 2017.

Revenue efficiency for the quarter was 90.9% and contract utilization was 25%. At the end of September, WilPhoenix had a total contract backlog of approximately $41.4 million.

In September, the WilPhoenix semi-submersible rig started operations for Shell UK at the Puffin location. In October, Awilco signed a contract amendment for WilPhoenix with Shell, allowing for more extension options. Each option covers the drilling of a single exploration well within or at the end of the current decommissioning program. The options are to be declared by August 31, 2019.

During the third quarter 2018 the WilHunter remained cold stacked in Invergordon where it has been for a while now.

According to Awilco, the Norwegian market for modern high end semi-submersibles has continued to see further fixture activity with little availability now remaining in 2019 and only around 1/3 of available rig days in 2020 remaining clearly available. Fixtures remain around $300,000 excluding potentially material bonus amounts.

In the UK reduced supply coupled with increased demand is expected to see the current marketed fleet soon sold out for the summer of 2019. This is expected to result in day rate pressure and reduced seasonality in the region with higher utilization levels forecast in the winter of 2019 into 2020.

Offshore Energy Today Staff

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