Borr Drilling is a pure-play offshore jackup drilling company — owning and operating a fleet of modern shallow-water drilling rigs that work for oil companies in the Middle East, Southeast Asia, West Africa and the North Sea. The offshore rig utilisation rate is the definitive cycle signal: when utilisation falls below 58%, Borr approaches distress; when it rises above 85%, day rates surge and earnings multiply.
Why Rig Utilisation Drives Borr Drilling
Borr Drilling owns approximately 23 modern jackup rigs — shallow-water drilling platforms that stand on the seabed (up to 400 feet depth) and drill wells for oil and gas. All of Borr's rigs are modern (built 2010 or later), giving them a competitive advantage over older rigs in tight markets. When jackup utilisation exceeds 85%, operators can command premium day rates and multi-year contracts. When it falls below 58%, rigs stack (go idle) and day rates collapse.
Borr was founded in 2016 specifically to acquire modern jackup rigs at distressed prices during the 2015–2016 downturn — creating a fleet at low cost that would benefit enormously from the next upturn.
The 2020–2023 Cycle: +963% in 42 Months
COVID-19 sent oil demand and jackup utilisation to historic lows. Borr fell to $0.8 — near bankruptcy. As Brent recovered and oil companies resumed drilling programmes, jackup demand surged. Modern rigs (like Borr's fleet) were particularly sought after. Borr reached $8.5 by September 2023 — a gain of 963% in 42 months. This is the highest rig cycle return in the Signycle universe.
Borr's Pure-Play Advantage
Unlike diversified offshore service companies (Subsea 7, TechnipFMC), Borr has no day rate diversification — 100% jackup, 100% day-rate dependent. This creates extreme operating leverage: every $10,000/day increase in average day rates flows almost entirely to EBITDA. In rising markets, this is extraordinary. In falling markets, it is devastating.
Key Risks
Borr's main risks are high debt levels (the company borrowed heavily to build its fleet), jackup oversupply risk (new rig deliveries from Asian shipyards), and the long-term energy transition reducing shallow-water oil demand. The Hormuz crisis has increased Middle East drilling activity — where Borr has significant exposure — providing near-term support.
Cycle Performance Summary
| Parameter | Value |
|---|---|
| Exchange | Oslo Børs |
| Signal | Offshore Rig Utilisation |
| Buy date | March 2020 |
| Buy price | $0.8 |
| Sell date | September 2023 |
| Sell price | $8.5 |
| Return | +963% |
| Duration | 42 months |
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