Market conditions

The majority of investments made in the Offshore Drilling sector in 2013 were concentrated in the Golden Triangle of West Africa, Brazil and the Gulf of Mexico. West Africa, with Angola leading the way, maintained its position as the key area for offshore exploratory activities in Africa, Brazil continued its leadership of the deep-water market, while the Gulf of Mexico, on the back of a number of new discoveries, followed the growth trend seen in the previous years.

Worldwide in 2013, the overall number of rigs under contract grew compared with 2012. The increase was concentrated in the Middle East and Asia-Pacific for jack-ups and the Gulf of Mexico and West Africa for the floaters market. In absolute terms, Latin America once again proved to be the key area for the floaters market, particularly for drillships.

Global utilisation rates were up compared with 2012 and continued to top the 90% mark. In the floaters segment, utilisation rates close to 100% were recorded in a number of areas of the world (particularly for drillships in the Gulf of Mexico and Latin America and semi-submersibles in Northern Europe and Latin America). Conversely, a slight drop was registered in West Africa. Utilisation rates for jack-ups rose grew in all areas, with the highest figures recorded for jack-ups operating in North Western Europe and for high spec type jack-ups.

Average day rates in 2013 grew slightly compared with 2012, with the biggest increases seen in the Gulf of Mexico and West Africa for both jack-ups and floaters segments. 2013 rates for floaters operating in ultra-deep waters were on average in line with 2012 levels, but the maximum rates paid on the market dipped.

Despite a contraction in orders placed for new floaters compared with previous years, new rig construction levels remained strong. At year-end 2013, 129 rigs (including rigs being built for the Brazilian market by local operators) were under construction. Of these, a significant number – particularly jack-ups, but to a lesser extent also drillships and semi-submersibles – had not secured contracts.

Meanwhile, 6 rigs were removed from the market during the year – less than half the number registered in 2012: 2 high spec jack-ups (one due to conversion and another due to accident) and 4 standard jack-ups (demolition, conversion or sale).