Under the three-year contract, which starts from first spud, High Arctic will lease and manage Oil Search's new heli-portable Rig 103, which is currently under construction in China.

The rig is expected to start operations in the fourth quarter of this year.

High Arctic is already providing project management services in China with respect to the construction and commissioning of the rig and will manage the mobilisation of the rig to PNG.

"PNG is one of the world's premier exploration areas. Beyond the significant revenue generated from these contracts with OSL, their award further demonstrates our ability to develop international opportunities for the benefit of our investors," High Arctic chief executive Jed Wood said.

The company is also negotiating with Oil Search to convert an existing management and operation contract for Rig 101 into an onshore drilling services contract on similar terms as for Rig 103 as well as contracts for support services and rental equipment with potential annual revenues of about $15 million.