Nearly fifty drilling platforms were scrapped in 2020, which is significantly more than in previous years, reports the French financial services provider Kepler Chevreux.

The company’s analysts believe that 2021 will also be a tough year for the offshore drilling industry, which entered a crisis early last year due to the combination of a deep fall in the oil price and a drop in demand due to the corona pandemic. Many operators have temporarily mothballed rigs to weather the storm.

Kepler Chevreux does think that demand for offshore drilling services will pick up again in the next two to three years. The demolition that has taken place in the past year may then prove to be an advantage. The analysts assume that fewer platforms will be offered for scrapping this year because most of the old platforms have now disappeared from the fleet.

30 billion dollars

According to an annual review by Norwegian rig broker Bassoe Offshore, the total market value of all drilling units fell by about USD 30 billion last year to just over USD 40 billion. Five major operators were forced to file for Chapter 11 credit protection in the US, including Noble, Diamond Offshore, Valaris, Seadrill and Pacific Drilling.

The latter has ended the proceedings just last week, after the court approved a major restructuring and an agreement with its creditors. The group, which is owned by the Israeli entrepreneur Idan Ofer, has seven drillships, of which at least three have been laid up.