Fredrik Steen

Fredrik Steen sought more color on Borr Drilling's specific view on the day rate development trajectory, given increased tenders and utilization, and when higher activity would impact bidding levels. He followed up on Borr Drilling's contract length strategy (short vs. long-term) and inquired about any changes to Saudi Aramco's contracting terms, particularly regarding suspension ability.

Answer

CEO Bruno Morand noted that rates have been sideways, with some downward pressure in Asia. He expects pricing dynamics to progress once Middle East tenders conclude, likely in Q3, as rigs will be out of the market for lengthy preparations. For 2026, the focus is on de-risking utilization, with 2027 focusing on economics and rates. Mr. Morand explained that with a 29-rig fleet, a mix of short and long-term contracts is necessary, avoiding long-term commitments in lower-margin regions. He noted that Aramco's tender documentation shows some flexibility on terms, especially around termination provisions, but mainly on the technical side.

Fredrik Steen asked for more insight into the trajectory of day rate development, specifically when increased activity levels are expected to impact bidding. He also questioned Borr Drilling's strategy regarding contract length and any changes to Saudi Aramco's contracting terms, particularly concerning termination provisions.

Answer

CEO Bruno Morand noted that rates have been largely sideways, with some downward pressure in Asia. For 2026, the focus is on utilization, especially for short-term opportunities. He anticipates pricing dynamics will improve after Middle East tenders conclude (mid-year awards), with better visibility expected in Q3. Regarding contract length, Mr. Morand stated the 29-rig fleet requires a mix of short and long-term contracts, optimizing for margins and gap-filling. He added that Aramco's tender documentation indicates some flexibility on terms, particularly around termination provisions, mainly on the technical side.