Valaris Limited secured a multi‑year contract with Shell for its seventh‑generation drillship VALARIS DS‑8, a deal valued at roughly $300 million and covering about 800 days of drilling services that will begin in the first quarter of 2027.
The contract is part of Shell’s Orca project, formerly known as Gato do Mato, a deep‑water development in Brazil’s Santos Basin that is expected to produce up to 120,000 barrels of oil per day and reach production in 2029. Valaris’s award of the DS‑8 contract adds a significant backlog to the company’s already robust pipeline, which stood at more than $2.5 billion year‑to‑date.
Valaris’s fleet is dominated by high‑specification, seventh‑generation drillships, and the company has been targeting long‑term, high‑dayrate contracts to support a barbell strategy that pairs premium deep‑water rigs with high‑margin jackups. The DS‑8 award is a key milestone in that strategy, reinforcing the firm’s ability to win high‑profile projects in competitive offshore markets.
The contract is expected to help Valaris achieve its goal of 90 % drillship utilization by the end of 2026, and it will contribute to the company’s forecasted revenue and cash‑flow visibility for the coming years. CEO Anton Dibowitz said the award demonstrates Shell’s confidence in Valaris’s technical capabilities and the growing interest in Brazil’s pre‑salt region, where the company’s assets are positioned to capture new opportunities.
The deep‑water market is experiencing an upcycle, with rising dayrates and tightening supply. Valaris has been securing contracts at average dayrates of $432,000 for 2026 and $506,000 for 2027, and the DS‑8 deal aligns with that trend, providing a stable revenue stream that supports the company’s long‑term growth plans.
The award also underscores Valaris’s focus on operational excellence and cost discipline, which have helped the company maintain profitability even as it expands its backlog. By securing a multi‑year contract with a major operator, Valaris strengthens its competitive position and enhances its ability to invest in fleet upgrades and new projects.
Overall, the contract represents a significant win for Valaris, adding a high‑value, long‑term revenue source that aligns with its strategic focus on premium deep‑water rigs and positions the company to benefit from the ongoing upcycle in the offshore drilling industry.
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