For 2012, land rig utilization in the Middle East was at 100% while the percentage in every other region except Latin America (88%) was in the mid-90s. The worldwide offshore mobile rig fleet grew by 4% in 2012 to 824 rigs with the addition of 44 new rigs, representing the fourth year in a row for at least 40 additions to the fleet.

Those were two of the many highlights of the 59th annual rig census presented by National Oilwell Varco (NOV) at the 2012 annual meeting of the International Association of Drilling Contractors (IADC) in Scottsdale, Ariz., Nov. 9.

The enthusiasm for higher specification land rigs and deepwater mobile rigs was obvious at the IADC’s annual meeting. The emphasis on safety also was at the forefront of the drilling contractors’ agenda.
Robin McMillan, senior vice president of Business Development, NOV, presented the rig census. In the US, total available rigs dropped by 2% to 3,006 units. US rig utilization rose to 75%, up from 67% the previous year.

“Over 50% of the fleet is now less than seven years old. We are turning over the fleet faster than we have done before,” McMillan said.

For the worldwide offshore mobile fleet, the number of active rigs reached 626, the highest level since 2001. With the number of active rigs increasing, utilization rose to 76% for the offshore mobile fleet.

As the census pointed out, contractors remain optimistic, with 45% of survey respondents planning to expand current fleets. Another 28% had no plans for expansion, while 12% were seeking merger opportunities.

Mike Acuff, senior vice president, Contracts and Marketing, Diamond Offshore Drilling Inc., said that in the near term, there will be a shortage of rigs in the mid-water, deepwater, and ultra-deepwater markets. Over the long term there will be a significant number of new rigs coming out in 2014, and the market could come back in line.

Acuff added that the rigs for ultra-deep water, which has a depth greater than 2,272 m (7,500 ft), and deep water, which has a depth from 1,515 m to 2,272 m (5,000 ft to 7,500 ft), are “sold out in effect for 2013. The first available rigs will be in 2014. Operators are lining up for rig capacity.”

A year ago, day rates were in the US $300,000 range. In the past 12 months, those rates have gone up to $500,000 per day, and availability in 2013 is difficult, he continued.

The number of offshore rigs under construction is almost at the peak level reached in 2008. Newbuilds have gone up for two reasons: higher demand and attractive shipyard pricing in Singapore and South Korea, he noted.

It was encouraging to see the optimism from the contractors.

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