Atwood scraps semi-sub rig as red ink spills

  • Business & Finance

Offshore drilling contractor Atwood Oceanics has sold one of its semi-submersible drilling rigs for scrap after recording a loss and decrease in revenues in the first quarter 2017. 

The offshore driller said on Monday that it had recognized a net loss of $28.9 million on revenues of $167.7 million for the first quarter 2017 compared to net income of $122.4 million on revenues of $296.4 million for the corresponding period of 2016.

During the quarter, Atwood concluded that the semi-sub rig Atwood Eagle and its materials and supplies were impaired so the company wrote them down.

The driller recorded a non-cash impairment charge of approximately $59 million, which includes a write-down of property and equipment and deferred costs of $49.6 million, a write-down of inventory of materials and supplies that was specific to the Atwood Eagle of $8.4 million, and accrued estimated transaction costs of $1 million.

On May 5, 2017, Atwood executed a sale and recycling agreement for the Atwood Eagle according to which the rig and its equipment and machinery will be sold to a third party to be demolished and recycled.

The 1982-built drilling rig has been idle since May last year after its contract with Woodside got transferred to Atwood’s other, younger rig.

Offshore Energy Today Staff

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