Bassoe: Ultra deepwater drillship Deepsea Metro I sold for $262.5 M

The current fundamentals in the market aren’t driving values; buyers are. As deepwater drillship transactions keep trickling in, values are likely to climb further.

Image: Golden Close Maritime Corp

Golden Close Maritime Corp. announced [on Tuesday] the sale of their only drilling rig, the Deepsea Metro I, to an Asian buyer.

The drillship, built in 2011 by Hyundai Heavy Industries and managed by Odfjell Drilling, has been warm stacked in Malaysia since 2017 after seeing its most recent contract in disputed waters offshore Vietnam cut short due to force majeure. Since then, the rig has been a primary transaction candidate.

Although the buyer isn’t confirmed, it’s likely to be Turkish Petroleum (TPAO). TPAO acquired the Deepsea Metro I’s sister rig, Deepsea Metro II, (now called Fatih) in November 2017.

Drillship values are moving higher

Bassoe Analytics shows a value range of $222–246 million for the Deepsea Metro I compared to the acquisition price of $262.5 million.

In an update last week, we wrote that values for modern ultra-deepwater drillships (6th and 7th gen) have risen by another (approximately) 5%. This upward movement is primarily sentiment-based and not driven by current utilization and dayrate trends. And we expect transactions in the near-future to clear at or above these levels.

Although this deal isn’t purely sentiment-driven – it’s an example of a state-owned entity who’s developing their own offshore activities and who wants to operate their own offshore rigs – TPAO seems interested in timing the market right.

Considering that the rig is likely to be well-maintained and will be owner-operated (assuming TPAO is the buyer), we believe the sales price is fair, if slightly more favorable to the seller today. But in time, this deal could end up looking great for the buyer.

For reference, Bassoe Analytics values the newest and highest-spec 7th generation drillships in the fleet at $329–364 million. At the other end of the segment, most older 6th generation drillships have moved up to around $215–238 million.

Another rig taken out of the international market

As the rig will likely not continue competing in the international ultra-deepwater market, the transaction can be seen as positive for other drillship owners. The price level also adds real support to values for similar assets.

More buyers to seek competitiveness by locking in low asset values


There really isn’t much to say about the drillship market right now. It’s sort of better than it was a year or two ago, but utilization (slightly above 50%) and new fixture dayrates remain gridlocked. Most new contract fixtures are in the $140,000–200,000 range depending on the region and asset.

But there’s a growing number of rig owners and investors who agree with us that the market will experience significantly higher utilization which could cause dayrates to double. The problem is that nobody’s been right yet on when that’s going to happen.

Some companies, like Northern Drilling, have tried to take advantage of low drillship values and time the market’s return to greatness. If that happens within a reasonable timeline, they’ll generate strong cash flows. That’s what’s driving values now, and we expect it to continue.

With several other ultra-deepwater drillships in play right now (Bolette Dolphin and Pacific Zonda, among others), look for more reference points to come.

Offshore Energy Today has shared the article above with permission from the author. You can read the original post at

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Offshore Energy Today.

Share this article

Follow Offshore Energy Today

Posted on October 24, 2018 with tags .


<< Jan 2020 >>
30 31 1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31 1 2

Africa Oil Week 2020

For over 25 years Africa Oil Week has been the meeting place for Africa’s most senior E&P stakeholders.

read more >

CERAWeek 2020

 Each year, CERA clients gathered for a few days in Houston…

read more >

Offshore Technology Conference (OTC) 2020

The Offshore Technology Conference (OTC) showcases leading-edge technology for offshore drilling, exploration…

read more >


The development of consensus standards is one of API’s oldest and most successful programs.

read more >


Looking to fill a job opening?

By advertising your job here, on the homepage of, you'll reach countless professionals in the sector. For more information, click below...


Looking to fill a job opening?

By advertising your job here, on the homepage of, you'll reach countless professionals in the sector. For more information, click below...