ARO Drilling has received a notice of suspension for one of its 19 contracted rigs, the jackup Valaris 143. The company, a joint venture in Saudi Arabia between Valaris and Aramco, has been notified by Aramco of the suspension.
The rig’s contract was previously scheduled to end in December 2024, Valaris said in a media release. Valaris has leased Valaris 143 (EXL I) to ARO under a bareboat charter agreement.
The suspension notice may extend up to twelve months, as ARO continues discussions with Aramco to determine the effective date of the suspension. Notably, ARO retains the right to terminate the drilling contract with Aramco during this period.
Valaris and its ARO Drilling JV faces a similar situation to that of Shelf Drilling. The latter had operations of four of its jack-up drilling rigs suspended recently by its client in the Middle East.
The cancellation follows Aramco’s decision to scale down infill drilling and reduce capital expenditure in the coming years. The company said in its 2023 results statement capital investments reached $49.7 billion, representing a 28 percent increase over 2022 capital investments.
Aramco said it expects 2024 capital investments to be anywhere between $48 and $58 billion, and to continue growing until around the middle of the decade. The company added that it expects to reduce capital investment by approximately $40 billion between 2024 and 2028.
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