North Atlantic Drilling Ltd. (NADL) has secured 10-year contract awards from ConocoPhillips Skandinavia AS for the West Elara and West Linus jackups for work in the Greater Ekofisk Area in the Norwegian North Sea, a news release stated.

The total additional backlog for the awards is estimated at $1.4 billion, excluding performance bonuses, NADL said in the release. The awards, however, are subject to ConocoPhillips receiving partner approvals for the contracts.

As part of the agreement, NADL has agreed to a day rate adjustment on the existing West Linus contract effective from April 2017, resulting in a $58 million reduction in the current backlog. The contract has been extended from May 2019 until year-end 2028 at a market indexed day rate, which NADL said it believes will contribute an estimated $706 million of contract backlog.

The new West Elara contract, which is expected to commence in October 2017, includes a period of fixed day rates until March 2020 and contributes about $160 million of contract backlog, according to the release. A market indexed rate is applicable thereafter until October 2027, which NADL said it believes will contribute an estimated $530 million of contract backlog.

Offshore