Premier Oil Scraps Drilling Rig With Immediate Effect

Published at 08:59AM - 12/02/16

Premier Oil scraps drilling rig with immediate effect in a dispute with owners Ocean Rig, ending its time drilling oil offshore Falkland Islands.

The drilling rig in the middle of the dispute is Ocean Rig’s Eirik Raude semisubmersible, that has been on joint contract to Premier Oil and Nobel Energy in the south atlantic since 3rd June 2014.

Premier Oil Scraps Drilling Rig

Premier Oil announced the news Friday stating: “Following a number of material operational issues with the Eirik Raude rig during the term of the contract to date, Premier and Noble Energy issued a termination notice to Ocean Rig on 11 February 2016, terminating the contract with immediate effect”

Back in January, there were hints that all was not well on the contract as Ocean Rig themselves released a statement indicating that Premier had already issued them with a ‘notice of breach of material obligations’.

At the time Ocean Rig said that they were ‘evaluating the contents of this notice and its options under the contract’.

Offshore Chatham Exploration

The decision puts the partners of the Falkland’s Chatham prospect in a corner as, under the terms of the license, they are expected to drill.

In their press statement, Premier Oil clearly stated that the Chatham exploration well will no longer be drilled under the current drilling campaign.

On the matter of the licence agreement, Premier said: “we are in discussions with the Falkland Islands Government regarding the possibility of drilling this prospect in the future.”