Malaysia’s Velesto Energy has agreed to terminate without cause a drilling contract involving the Naga 8 jack-up rig, effective 7 July 2026.

The contract followed a letter of award confirmed in May 2025 for jack-up drilling services for PC Ketapang II, PC North Madura II and Petronas North Ketapang.

Before the termination, Naga 8 completed the first phase of the programme, comprising three of the 12 committed wells over approximately eight months.

The rig is currently deployed for Jadestone on the East Belumut Phase 9 infill drilling project offshore Peninsular Malaysia under a separate contract. The assignment is valued at approximately $16.5 million, or about RM 64 million, and runs from March to July 2026.

Velesto Energy said the termination would allow it to market the rig for alternative deployment opportunities. The company is seeking new contracts with different commercial terms and drilling sequences.

The company does not expect the termination to have a material adverse effect on its earnings or net assets for the financial period ending 31 December 2026. Its assessment takes into account the ongoing Jadestone contract and its pursuit of new contract opportunities.

The announcement follows the termination of a sale and purchase agreement with PT Indonesia Drilling Energy for the disposal of the Naga 3 jack-up rig. The agreement was signed on 14 December 2025.