Borr Drilling exits Mexico JV but keeps rigs and $1bn contracts
Borr sells 51% stake in Perfomex to local partner while retaining ownership of three jackups under bareboat charters.
While the local partner will take full control of Perfomex and its management responsibilities, Borr will retain ownership of three jackup rigs, Galar, Gersemi, and Njord, currently under contract with Pemex through bareboat charter agreements.
The restructuring, announced on September 15, is set to simplify Borr Drilling’s corporate and operational footprint in Mexico while maintaining its economic participation in the underlying contracts. The transaction is expected to close later this month, subject to customary conditions, with the consideration based on the estimated net book value of Borr’s Perfomex interest as of July 31.
Why Borr Drilling is restructuring its Mexican operations
The decision to divest its majority stake in Perfomex follows Borr’s recent expansion in Mexico, where it acquired five premium jackup rigs through BC BC Ventures Limited, a 50-50 joint venture with the same local partner. The move is designed to streamline Borr’s operating structure, allowing it to focus on independently marketing and deploying its fleet to other operators in the region while strengthening its local partnership.
The company operates a modern fleet of high-specification rigs designed for efficiency and safety in demanding offshore environments.
Under the new arrangement, Perfomex will continue to provide integrated well services to Pemex, while Borr will maintain ownership of the three rigs, Galar, Gersemi, and Njord, currently operating under long-term contracts. The Galar and Gersemi rigs are contracted through May 2030, while the Njord rig’s contract extends to April 2028, with extension options. Borr has stated that the economics of the bareboat charter agreements are expected to remain largely unchanged, ensuring continuity in revenue streams.
What this means for Borr Drilling’s future in Mexico
The divestment reflects Borr Drilling’s broader strategy to optimise its asset deployment and operational efficiency in key markets.
The company’s recent acquisition of five premium jackup rigs through BC BC Ventures Limited underscores its commitment to expanding its presence in Mexico.
For stakeholders, the restructuring offers several advantages. Borr Drilling will continue to generate revenue from its bareboat charter agreements with Perfomex, ensuring a steady income stream from the Galar, Gersemi, and Njord rigs. Additionally, the simplified operational structure reduces overhead costs and administrative complexities, allowing the company to focus on strategic growth initiatives. The move also strengthens Borr’s partnership with its local counterpart, which could facilitate future collaborations in Mexico’s evolving energy sector.
Mexico’s shallow-water drilling market remains a critical component of the country’s energy strategy. With Pemex prioritising offshore exploration and production, demand for high-specification jackup rigs is expected to remain robust. Borr’s decision to retain ownership of its rigs while transferring operational control to its local partner positions the company to respond swiftly to new contract opportunities. This flexibility is particularly valuable in a market where operators frequently adjust their drilling programmes based on commodity prices and regulatory changes.
With the transaction expected to close in September 2026, Borr Drilling is poised to enter a new phase of its operations in Mexico, one that balances local partnership with independent fleet deployment. The streamlined structure is likely to enhance the company’s ability to respond to market demands while maintaining its financial stability through long-term charter agreements.
By leveraging joint ventures and strategic partnerships, companies can maintain a presence in high-potential regions while mitigating operational risks. The model also allows contractors to scale their fleets quickly in response to market demand, a critical advantage in a sector characterised by cyclical activity.
Looking ahead, Borr Drilling’s ability to independently market its rigs to other operators in Mexico could open new revenue streams. While Pemex remains the dominant player in the country’s offshore sector, private operators and international oil companies are increasingly active in shallow-water blocks. Borr’s fleet, which includes five recently acquired premium jackup rigs, is well-positioned to compete for these contracts, further diversifying its income sources in the region.
For readers tracking developments in the offshore drilling sector, Borr Drilling’s restructuring in Mexico offers a glimpse into the strategies employed by contractors to navigate complex regulatory and operational landscapes. The move underscores the importance of local partnerships in securing long-term contracts while maintaining the flexibility to respond to shifting market conditions. As the transaction progresses, stakeholders will be watching closely to assess its impact on Borr’s financial performance and its ability to capitalise on Mexico’s shallow-water drilling opportunities.
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