Oil & Gas UK Activity Survey 2016

Figure 25: Number of Rigs on the UK Continental Shelf

1

30

25

2

20

3

15

Semi-Submersible Rigs Jack-Up Rigs

Number of Rigs

10

4

5

0

5

Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

Source: North Sea Reporter

The market daily rig rate continued to decline in 2015 in response to falling demand. While daily rates for jack-ups held up at the beginning of 2015, the average day-rate fell by over $50,000 during the second half of the year. This lag occurred because a number of rigs were leased on long-term contracts and it is only when those contracts expire that the rates adjust to reflect market conditions. Semi-submersible rigs, used for drilling in the deeper waters of the CNS, NNS and west of Shetland areas, saw a much sharper decline from an average day-rate of $400,000 in mid-2014 to almost half that by the end of 2015.

6

Figure 26: Daily Rig Rates Based on Reported Contract Awards for Mobile Drilling Units

500

Semi-Submersible Rigs Jack-Up Rigs

450

400

350

300

250

200

150

Rig Rate (Thousand $/Day)

100

50

0

Jul-06

Jul-07

Jul-08

Jul-09

Jul-10

Jul-11

Jul-12

Jul-13

Jul-14

Jul-15

Jan-06

Jan-07

Jan-08

Jan-09

Jan-10

Jan-11

Jan-12

Jan-13

Jan-14

Jan-15

Jan-16

Source: North Sea Reporter

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