Paratus Energy Services Faces Early Termination of Drilling Contracts

Paratus Energy Services, a company backed by John Fredriksen, recently received a notice from an undisclosed client indicating the early termination of drilling contracts for two of its jackups. The termination affects the 2007-built Courageous and the 2008-built Intrepid jackups, reducing Fontis Holdings’ backlog to approximately $39 million, or 3% of Paratus’ total $1.2 billion backlog.

The client cited unfavorable contract terms, such as limited suspension rights and dayrate indexation structure, as reasons for the early termination. Economic considerations also played a role in the decision. However, the client clarified that the move was not due to reduced operational need for drilling rigs in 2026.

Paratus believes that the early termination may allow the client to align contractual terms more effectively across its service providers in 2026. Despite this development, the company remains optimistic about the need for increased drilling activity to meet the production goals of its client in Mexico. Fontis Holdings will continue to explore opportunities for its fleet within and beyond the region.

As a result of the termination, the contracts for the Courageous and the Intrepid will now expire on February 28, 2026, instead of their original expiration dates in November and May, respectively. While the client’s identity remains undisclosed, it is known that the two jackups have been under contract with Mexican oil giant Pemex for an extended period.

Despite the early termination, Paratus Energy Services recently secured a 78-day contract extension for the Oberon rig. The company stated in a filing with Oslo Bors that all Fontis rigs are currently under contract, with the exception of the Titania, and most rigs are contracted into 2026.

With all 11 assets currently under contract, Paratus Energy Services has a strong position in the market, with the majority of contracts extending into 2027 or 2028. The company remains committed to providing high-quality drilling services and meeting the needs of its clients in the oil and gas industry.