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Petrobras rig pool tender saw limited competition and likely supportive dayrates

Today, the Petrobras ‘rig pool’ tender for up to four deepwater rigs with 3-year duration across three lots closed. Initially, it appears that seven contractors with nine rigs participated, split between four locals (Constellation, Etesco, Foresea and Ventura) and three international contractors (Seadrill, Valaris and Transocean). Hence, the participation would be less than at the recent Petrobras tender for Sepia/Atapu, which saw nine contractors taking part with 15 rigs. With different technical requirements in the three lots and a large spread in technical specifications among the rigs offered, we believe there is a large spread in dayrates offered. For local contractors, we would expect to see dayrates of USD350k–400k for 6G rigs, while we expect international contractors bidding high-spec 7G drillships mostly at USD450k–475k. In such a scenario, we would consider dayrates to largely be on a par with recent awards and ongoing tenders from Petrobras. While total contract economics are less in Brazil versus other markets (at the same headline dayrate), we consider a scenario with the dayrate ranges above as supportive for the offshore drilling sector, in particular taking into consideration the soft investor sentiment at present.