“Talk to me, talk to me,” sings Olivia Dean as she opens her mellifluous UK number two single “Man I Need,” which is beaten for the top spot only by the soundtrack of the 2025 Netflix animation KPop Demon Hunters.
I will follow her advice and talk to you about the latest developments in the offshore market. I am the man you need…
Flush with cash following the change of ownership to the control of India’s Adani Group, the ports to cement to refineries conglomerate closely tied to India’s ruling BJP Party, Astro Offshore of the UAE has bought another five vessels in West Africa.
We broke the story of the company buying two DP2 platform supply vessels (PSVs) from India’s Alphard Maritime on September 8. Those vessels now renamed Astro Rastaban and Astro Rigel are both in West Africa, with one working in Nigeria, one idle in Namibia.
Now, Astro has announced on social media that it has now bought four more DP2 PSVs and a multipurpose vessel, managed by CS Offshore, which will remain the manager of the ships until Astro has built out its own team by the end of the year.
The 90-berth Astro Antares maintenance vessel is the former Island Sapphire, built in China in 2018 as the PSV Martha’s Pride and bought by the sellers from the Nigerian bank in May 2024 after the owners (surprise!) defaulted on their loan. CS has spent the last year converting it with a 160-ton lattice boom crane in Spain and the ship now lies idle in Cadiz.
It’s not clear where the natural market for that vessel lies, given that Mexico is now dead to new vessels and that a voyage through the Red Sea and Suez back to the Astro heartland of the Arabian Gulf would be risky given the Houthi threat, and a move via the cape would be quite expensive.
Meanwhile, competitor Promar has at least one similar DP maintenance vessel available in West Africa, and perhaps cashed-up Astro could take over Promar as its next purchase, as that PSV owner and maintenance vessel operator was advertised for sale in 2024.
The other four PSVs are already in West Africa, two 3,200DWT vessels, one built in 2014 (now Astro Roseland) and the 2018-built, Nigerian-chartered Astro Rosette (ex-Island Girl) along with the 2014 sister PSVs with 3,800 DWT Anjali and Randeep, which will be renamed Astro Rasalas and Astro Rubin, respectively. Despite the Island prefix in the names of some of the units, the vessels Astro has bought are not connected to Island Offshore of Norway.
Astro’s six PSVs in West Africa give the company a strong presence behind market leaders Tidewater and Bourbon outside Nigeria, and behind Nigeria’s largest PSV operator E. A. Temile in Nigerian waters. Crucially, the price of the purchase of the five vessels has not been disclosed by Astro, just as the price of the Alphard units it bought has not been made public either.
But public prices are available for the other deals of last week.
Just as we thought, lower prices have finally enabled Chinese lender ICBC to sell another four laid-up Bourbon vessels in the ongoing auction process last week. Three laid-up Bourbon Liberty 100 series PSVs were sold en bloc for US$9.7 million, higher than I expected them to sell for, whilst the subsea vessel Bourbon Evolution 803, which has been cold-stacked in Abidjan since April 2018, finally sold for US$17 million.
This price is a far cry from the original price of US$24 million at which the vessel was originally offered in June but still better than my estimate of US$15 million, so ICBC can be pleased – well, as pleased as a bank that probably lent US$60 million in 2013 plus accrued unpaid interest for a ship that sold at less than 30 per cent of that price can be.
The sister vessel Bourbon Evolution 801 has also been reoffered in the next auction at a lower price of US$17.1 million on September 23, along with one other unsold Bourbon Liberty 100 series PSV and two unsold 80-ton bollard pull Bourbon Liberty 200 series anchor handlers.
Our updated table captures the latest reserve prices and the prices at which the ships sold so far have transacted at.
Vessels shaded with the same colours were sold en bloc together at the individual vessel prices shown. As usual, shipbid.net has not disclosed the buyers of the ships concerned. You can track the progress of the auctions here.
With around another 25 vessels still under Bourbon management on which ICBC holds loans or sale and leaseback agreements that are in default, it is not clear what the bank’s next steps will be when the final four ships in this first tranche of the sale process are eventually sold.
Bourbon has meanwhile revealed that it is progressing new investments in its Bourbon Mobility crew transfer division, as it seeks to make up for years of under-investment in its fleet due to the financial disputes with its lenders over its legacy debts and defaults.
The company announced a contract win for six newbuild 30-passenger crewboats with Eni in Congo in July, and this month it announced two new build 34-metre long, 38-knot, 60-passenger crewboats to be chartered to ExxonMobil in Angola under a new five year charter contract.
If West Africa is a focus of new investment, there are unfortunately, further signs of structural weakness in the North Sea drilling market. These were exposed earlier this month when PetroVietnam Drilling announced the acquisition of the Noble Corporation jackup Noble Highlander, which has been laid up in Denmark since 2022.
The Vietnamese state-owned driller has paid Noble US$65 million for the modern, 2016-build rig and plans to reactivate the unit and bring it to Vietnam to commence operations in 2026.
Noble has also disposed of two long-time laid-up drillships that it acquired when it bought Pacific Drilling in 2021. Pacific Meltem (built 2014) and Pacific Scirocco (built 2011) were simply too expensive to reactivate after many years in lay-up in the Canary Islands.
We noted on September 1 how Transocean has also moved to scrap another four lower-specification deepwater drillships in its fleet – Discoverer Clear Leader, Discoverer Americas, Deepwater Champion, and Discoverer India, which have been laid up in Greece after going into cold stack between February 2016 and July 2020.
Noble Highlander is different. The reactivation cost is relatively low, and the rig is relatively modern and believed to be in good condition. The sale tells us that Noble sees no short- or medium-term uptick in the North Sea jackup market.
Even though PSV rates out of Aberdeen hit the balmy levels of over US$10,000 per day last week with HM Flipper being fixed at £8,250 (US$11,100) on Thursday last week (less than half of equivalent spot rates elsewhere in the world), Noble’s sale tells us that both vessel and rig owners should be cautious into 2026.
The Norwegian sector is almost sold out of harsh environment semi-subs, and Northern Ocean announced the on-hire of its Odfjell-managed Deepsea Bollsta to Equinor earlier this month, but the UK sector remains dire, with owners selling, scrapping or relocating rigs away from the region as misguided "net zero" policies and high windfall taxes kill new projects out of Aberdeen.
There is no quick fix for the UK sector of the North Sea. New policies and incentives are required.
The global jackup market continues to recover after Saudi Aramco’s bombshell suspensions, however. Indeed, ADES agreed to increase its offer for Shelf Drilling and its fleet of 33 jackup rigs last week. ADES has upped its offer for the Norwegian listed rig owner from NOK14 (US$1.40) per share in August to NOK18.50 (US$1.89) now. This 32 per cent increase in the bid means that the equity in Shelf is now valued at around US$500 depending on the exchange rate at closing.
The higher price is a good deal for Shelf’s shareholders and means the takeover should close as more than 50 per cent of shareholders have agreed ahead of a general meeting on October 6. There will be many job losses in Shelf. One of the reasons ADES was willing to pay more was because the Saudi rig owner had identified even higher cost savings it thought it could achieve with the takeover.
If the Saudis at ADES were willing to pay more for Shelf, the shareholders of Aussie oil and gas producer Santos must be disappointed.
Last week Abu Dhabi’s state oil company ADNOC and its partners the private equity group Carlyle withdrew their US$18.7 billion offer to take over the Adelaide-based company. Santos shares promptly fell 10 per cent on the news, leaving the company valued at just over US$14.5 billion.
The collapse of the deal is embarrassing for Australia, which is now home to two seemingly unsellable and subscale national champions in oil and gas, Woodside and Santos. Oil Search was taken over by Santos in 2021. Neither Santos nor Woodside, which acquired BHP Petroleum in 2022, has an attractive growth portfolio and both remain heavily dependent on their Australian home market for production.
The ADNOC and Carlyle takeover of Santos would have been Australia’s largest takeover, but fears that it would never be approved by the government on national interest or national security concerns helped lead to the withdrawal of the offer, just as Shell was blocked from buying Woodside for US$10 billion in 2001. Woodside is now worth US$28 billion, not exactly a stellar return over a quarter century.
The buyers’ due diligence on Santos revealed a company that was not exactly performing at high levels. They found that unexpectedly large tax payments were due and that Santos had suffered a methane leak at its LNG plant in Darwin in the process. Whoops.
There were also differences over whether the buyers should provide binding commitments to provide domestic gas supply, a politically sensitive issue in a country that exports huge quantities of LNG but suffers shortage of gas supply to the local market and high energy prices domestically.
It should be emphasised that Santos and Woodside, along with the other gas producers in Australia, have contributed to these problems through their past taxation and sweetheart deals with the federal government, rather than the new buyers of Santos being intransigent on the issue.
Santos’ chairman Keith Spence (who should probably resign after the debacle, but won’t, because this is Australia) was reported in the Financial Times as giving perhaps the most out-of-touch defence I have ever read:
“Santos has a clear strategy, strong leadership and high-quality growth opportunities across our global portfolio. The board is confident these strengths will deliver long-term value for shareholders.”
Well, that’s okay then. I would venture to disagree, and the stock market thinks so too. The company’s shared now trade lower than they did in January 2021, well before the Russian invasion of Ukraine and the gas price spike that has so empowered the rest of the industry.
Santos is now betting the future on Alaska as its main (only) source of growth outside Australia. As ADNOC walked away, the company was trying to persuade investors of the merits of its onshore Pikka project there, in a completely surreal investor presentation and visit.
With MMA Offshore acquired by Singapore’s Cyan Renewables, floating wind projects stalled, and the continued delays and massive costs to decommission the Northern Endeavour floating production unit, Australia, like the UK, threatens to become an offshore backwater.
Regular readers will be shocked to discover that another case of corruption in Azerbaijan state oil company SOCAR has come to light!
On September 8, Ramin Isayev, the former general director of SOCAR’s drilling joint venture SOCAR AQS between 2008 and 2020, was sentenced to 14 years in prison in Azerbaijan on charges of embezzlement, fraud, money laundering, and abuse of office by the Baku Court of Grave Crimes.
The court also ordered the confiscation of real estate, cash, and other assets tied to Isayev and his family and their return to the state, as per Blitz coverage of the case.
The prosecution had claimed that Mr Isayev embezzled at least US$31 million from the state-owned oil company and that he spent much of the money on luxury real estate in neighbouring Turkey, as well as ordering cyber-attacks against the company he ran to try to cover the traces of his crimes.
In 2023, the Organised Crime and Corruption Reporting Project revealed that that Rashad Abdullayev, the son of Rovnag Abdullayev (CEO of SOCAR between 2005 and 2022), had bought a luxury property in London’s Grosvenor Square at the age of 25 for over US$22 million, and had been robbed of a Richard Mille watch worth over US$1.3 million in Ibiza.
Given Mr Abdullayev senior’s relatively low state salary and no other known sources of income, the provenance of the funds for these purchases by his son has never been made clear. No matter, Rovnag Abdullayev is now Azerbaijan’s deputy economy minister.
A summary of previous Azerbaijan corruption scandals is listed here.
Returning to Olivia Dean's song, it seems that the man Azerbaijan needs is someone with zero tolerance for corruption and nepotism and embezzlement.
Hmm...