and good the call, interest and Welcome Nick, morning, Thanks, to your everyone. Valaris. thank you in for
discuss briefly events months. Valaris's environment demand industry these and I offshore the that over macro on call, then will services I X for the provide the impacting and developed today's last will an operations. During are drilling how has update
have underway. the cost to initiatives will we that I speak Finally, reduction
over the remarks results. quarter my I first call to for Jon his hand on Following comments, will financial the
In has at around this crisis, stimulus world downturn. creating aimed pandemic fiscal programs response, businesses global aware. leaders limiting are we the coronavirus of the economic world, all policymakers and deployed people acutely affected have The of which a and impact
had global the hydrocarbons. in altered travel a impact clear these demand economy, uncertain and dramatic that programs how have jump-starting it will restrictions, effective is the quarantine behaviors it on While the prove orders is consumer for
commercial behaviors and the countries there a expect to hydrocarbon consumer anticipate world. take for to be of soon highly in We uncertain lifted Therefore, term. that return near particularly restrictions it Still, time is demand, normal. in picture around consumer will we to the
inquiries be Unfortunately, seen in production, poised several to been although surpluses last hydrocarbons challenges, has with energy among this agreements by planned simultaneously if several an created for be share services last supply In the of and operators intensity following face competitive point market are these demand We the front to to barrel late it crude This of concerns, and facing supply pressures per industry receiving light contraction less these storage month XXXX. are this there about to earlier February month backdrop, this shut-in $XX demand the that per has drilling In declined prices new Brent over late fallen capacity for months. than early offshore month. turn, in over nations competition appears to producers subside XX production. per X supply of reduce customer and the the were XXXX remains in excess oil-producing demand choosing swiftly barrel $XX will sufficient. from have to nearly Collectively, weeks. challenging
fleet. lead majority work to the We rigs expect the to global for of in these requests
come Valaris operators impacting existing work weeks move past off the a global total to utilization environment Not the and and X that Over drillers as received over of will lead global surprisingly, such with of rig seen or contract new rigs we month, fleet drop. delay to than pricing modifications for a for half along past these several is already for shortage several competitors. terms. concessions to This without its challenging contract and we of inquiries other in with follow-on anticipate cancel fewer we've the inquiries, well also programs, jobs offshore and asking opportunities, contracts having
asked some our of contract current have change kind of customers arrangements. to for Most
We and have modify had terminated agreed X to contracts several others.
the we of a the disconnected VALARIS was blowout received for been million revenue had approximately One the time, contract of incident. operating $XXX rig's preventer had Africa, when became remaining. At contract DS-X, offshore West backlog this terminations following which the nondrilling
will insurance offset this an with loss expect the As backlog policy that previously contract. disclosed, associated of largely we have we
the for and addition, In to weekend, BOP the Islands now the over mobilize rig past the we'll repairs. we recovered Canary seabed from the
DS-X, challenges logistical the led drilling with modifications, this have that customers, to our continue. expect completion we contract and of However, these will exception with challenging and and market trend programs, conditions
of as dutifully report being able Travel been I'm away with the restrictions challenges, time. offshore especially from and of our I'm these proud periods. our our human uncertain travel chain challenges rigs during resources performance offshore materials, have requirements crews, deploy created our and our work testament and these crewed This global over their for families rigs necessary despite employees extended also and significant we've that They've in have to to supply an despite operations, to a done teams quarantine of our to such partners. fantastic efforts to operating. supply our had rigs remote many said, to to locations. so workforce whom as pleased keep That well is often
expenses. for taking challenging this rightsize structurally we're drilling our rationalize backdrop offshore to fleet, our response In our and sector, to support costs action the lower operating
industry Valaris to offshore operations at mentioned that best reliable believe the and I've safe cost is the leader. lowest positioned for cost As success. want be offers driller I that the I before,
in we a By including putting we beginning savings preservation intend to $XX a to expect several latter of annualized than realize of minimize jackups. year. our costs, half readiness, the semisubmersible rigs, rigs competitive state of To drillships, our this and of into lower million these cost more X stack X
and the age floater drillships, DS-X X and water forward. the going will X We modern In most the be the and benign the capability given will that rigs profile XXXX XXXX. the the the competitive the DS-X, the sixth-generation fleet, capable of global semisubmersibles and believe XXXX, DS-X, XXXX, modern addition, only we retire
Given time amount to of rigs these the will they've been and combination the not capabilities reactivate economics these of make we out competitive that them of necessary rigs' do service, ever occur. technical believe the and
assets. plan we to retire So these
save the once taken in assets more impairments jackups. on We will costs decision company we've sold. these rigs discuss the Collectively, $XX also XX million the than will in retire these annually stacking scrap will to Jon a moment. X
support rate our premerger inclusive is fleet well aligns X our of expected early. the months as costs final with merger first run immediately synergy mentioned as shore-based shore-based run for utilization $XXX levels, of we million the support shore-based process XX% achieved At combinational merger X approximately local of operational last of G&A our the end expense the expense. closed, I phase rightsizing our within better contract conference before Today, reflect drilling also the is well target, exceeding synergies, support legacy organizations which support more call. that million a on rate the than of We're of quarter, to $XXX that and
less We half them expect the future, early what to to they costs lowering of further reduce than support in XXXX. in were shore-based
costs. While most reduce several potential operating to generation sustainably address underway, improve the daily help reductions these our is meaningful opportunity savings cash levels to through this, operating optimizing will fleet significant, including lowering repair processes spend. efforts operational We our improving management and supply that and we structurally are initiatives rig To and us by shore-based manning and chain safely maintenance costs. lower anticipate have
from rig expect savings levels. initiatives utilization, the While regardless depend will activity these on of to we benefit
keep focused XX% $XXX from we XXXX our spend for continue prior Lastly, and and conditions estimates, By safe efficient scrutinize expected full actively for footprint, with as carefully. they challenges. our rigs position contracts economically that a and our levels to operations the control, And costs, With to our uptime, challenging, the we best providing and overall operating opportunities capital rig are decrease provided utilized, our fleet remain million, what of to managing cost delivering company on our reducing can we to we reliable high services expenditures for navigate we cash limited support customers industry work market of rightsizing are the we arise and new the base. through preserve along and this marketed year to Valaris. we're win and viable
it with over turn Jon. And I'll that, to
