What is a turnkey drilling contract?

What is a turnkey drilling contract?

Simply stated the turnkey concept requires the drilling contractor to drill a loggable hole to a predetermined depth at a fixed lump sum cost. Though easy to define, the turnkey concept requires the contractor to accept more risks than required in the familiar daywork and footage concepts.

What is daywork drilling contract?

In relation to Oil & Gas law, a daywork drilling contract is one in which the lease operator hires a drilling rig and oilfield workers and retains the right to direct drilling operations. The lease operator pays an amount based on the time spent in drilling operations.

What is a turnkey contract in oil and gas?

A drilling contract that calls for the payment of a stipulated amount to the drilling contractor on completion of the well. In a turnkey contract, the contractor furnishes all material and labor and controls the entire drilling operation, independent of operator supervision.

How long is a contract on an oil rig?

6 to 12 months
How long are the contracts? Normally, from 6 to 12 months, depending on the company and the specific project. The different sort of contracts can be extended by mutual agreement.

How do oil rig contracts work?

The contractor furnishes the rig and a crew of sufficient size/experience to do proper drilling operations. In a footage contract, except for specified daywork operations, the contractor is paid a stipulated price per foot of hole drilled from the surface through the total depth of the well.

What is footage contract?

Footage Contract A “footage” contract provides that the drilling contractor be paid a stipulated price per foot of hole drilled from the surface to a total depth or some other specified depth. The IADC footage contract specifies that the operator is an independent contractor.

Can you get mail on an oil rig?

Can the employees receive mail or phone calls? Mail is not a problem, because it works as on land. But the use of the phone may be problematic, because must use a satellite connection.

  • September 20, 2022