Lamprell results hit by late jack-up rig delivery
Financial performance of the offshore rig builder Lamprell during the first half of 2016 was impacted by a late delivery of a jack-up drilling rig for which the company took a $35 million hit.
To remind, the delivery of the Ensco 140 jack-up rig was delayed in June this year due to a technical issue with the equipment supplied by an original equipment manufacturer.
According to Lamprell, this was due to the failure of the Cameron jacking equipment and the company is pursuing Cameron for all costs and damages.
Following a resolution of the equipment problem, the rig was delivered to its owner in August and the UAE-based yard and Ensco settled all claims arising from the late delivery.
The settlement agreement included a deduction of $25 million from the final milestone payment in respect of late delivery. As part of the settlement, Lamprell also agreed to provide services for the “Ensco 140 and 141” rigs, including temporary storage and grant an extended warranty for the jacking equipment supplied by the original equipment manufacturer, Cameron LeTourneau.
As a result of the settlement, Lamprell said on Thursday that the company’s expected 2016 revenue will be reduced by $25 million and the company anticipates a reduction of around $35 million on its expected 2016 profit.
Offshore Energy Today Staff