Aquadrill LLC ("Aquadrill”) has extended a charter hire agreement with a subsidiary of Diamond Offshore Drilling, Inc. (the “Manager”) to provide the Company’s Vela rig, an MPD outfitted 7th generation drillship, for operations in the US Gulf of Mexico for a 150 day drilling contract with a total expected contract value of approximately $60 million.
The terms of the charter hire agreement are consistent with the current management services agreements in place between the Company and the Manager. Further, the resulting financial benefits for the Company are as if the Company had entered into the drilling contract directly.
Concurrent with extending the charter hire for this new work scope, an agreement to suspend the underlying drilling contract related to the charter hire for the rig running from January to August 2023 has been entered into. This contract will be suspended after the first well and the new 150 day work scope will commence in direct continuation. The rig is expected to return to the initial underlying drilling contract in August 2023 and continue with the remaining firm work plus options if exercised.