Norwegian jackup rig owner Borr Drilling has reached an agreement with its joint venture partner in Mexico to sell a 49% stake in its integrated services, Opex and Akal (IWS JVs) and acquire an incremental 2% stake in the joint ventures performing drilling services.
The transactions, expected to close in Q3 2021, will free up a gross amount of $28m for Borr Drilling and some settlements of other payables, as well as give Borr Drilling a 51% majority ownership position in the drilling services joint venture.
Borr Drilling has five rigs working for joint ventures which are jointly owned with its Mexican partner, providing integrated well services for Pemex.
The drilling joint venture will continue to earn day rates from its main customers, Opex and Akal, through regular drilling contracts. Borr Drilling said that this should streamline its Mexican operation, reduce risk, and over time, lead to a more stable cash-flow.
The driller has recently secured extensions for its five jackups operating for Pemex, expected to remain working until December 2022.
The services commenced in May 2019 and have provided Pemex with an incremental production of approximately 125,000 barrels of oil per day from 21 wells drilled so far.
“With improved regularity in payments from Pemex, continued operation of Borr Drilling’s rigs in Mexico until 2022, the proceeds from the sale of the IWS JVs, and an overall activity for the company in excess of 13 rigs should provide the company with sufficient liquidity runway until the current debt maturities in 2023,” Borr Drilling stated today.