Houston: BP confirmed on Tuesday it had terminated two Gulf of Mexico deepwater drilling rig contracts because it needs to cut its exploration budget in reaction to falling oil prices.
The British oil giant said the affected rigs were the DS-4 owned by Ensco (incorporated in Britain but with operational base in Texas) and West Sirius owned by Seadrill of Norway.
“BP remains the largest investor and leaseholder in the US offshore and we will continue to realise further measures to underpin our long-term future there, as appropriate,” a spokesman said.
Last month the company said it aims to cut capital expenditures to $20 billion in 2015, as compared to $22.9 billion in the previous year.
Oslo-listed Seadrill said termination of the West Sirius contract would take effect after the current well was completed, probably in early May.
Contract terminations have become a common occurrence and something offshore drillers are learning to accept as the new normal.