Borr Drilling Cancels Contracts Amid Sanctions
Borr Drilling, a prominent player in the offshore jackup rig sector, has announced the termination of two drilling contracts due to international sanctions affecting its client. The contracts involved the Odin and Hild rigs, which were operating in Mexico and had commitments extending until late 2025 and early 2026, respectively. The company emphasized its dedication to complying with international laws and maintaining high standards of corporate governance.
Details of the Contract Terminations
The decision to terminate the contracts for the Odin and Hild rigs stems from sanctions imposed on the counterparty, although Borr Drilling has not disclosed the identity of the client involved. According to the latest fleet status report, the Hild was contracted to Fieldwood Energy and had been operating in Mexico since October 2023. The report did not specify the charterer for the Odin rig.
Both rigs had firm commitments that extended until November 2025 for the Odin and March 2026 for the Hild. The sanctions affecting Fieldwood Energy appear to be linked to its recent sale of a 50% operating interest in Area 4 off the coast of Mexico to Lukoil, a transaction that occurred shortly after the onset of the war in Ukraine. Following this sale, Fieldwood Mexico became a subsidiary of Lukoil.
On October 22, 2023, the United States imposed sanctions on Rosneft and Lukoil, which also encompass subsidiaries and companies that are 50% or more owned by these entities. Borr Drilling’s commitment to adhering to these sanctions underscores the company’s focus on compliance and corporate governance in a challenging international landscape.
