SeaBird looks to drive down costs further
Oslo-listed seismic player SeaBird has decided to reduce costs further and postpone capex until the market situation normalizes.
The company said that immediate effects of the COVID-19 situation are operational.
In particular, SeaBird said it is experiencing difficulties with crew changes for existing projects and mobilization of crew for new projects due to travel and immigration restrictions.
The company believes that this may have an impact on operational cost, due to additional salaries and increased travel costs.
Worst case, projects may also be delayed or cancelled due to the logistical challenges created by the COVID-19 restrictions.
So far, the main effect for the company has been the termination of two OBN surveys off West Africa.
In the event of a prolonged period of economic shutdown, SeaBird said it has contingency plans in place to reduce costs even further and place the vessels idle at a very low cost.
However, management believes it will not be necessary for the company to execute on its contingency plans.
SeaBird will postpone the remaining outfitting of the Fulmar Explorer until markets normalize and/or the vessel sees a contract award.
Meanwhile, the company will reengineer the project with an ambition to reduce the capex need further.
Further, the company has finished all preparatory work for rigging of the Geo Barents.
The vessel eyes a contract in the Eastern hemisphere, and the actual rigging will take place upon contract award.
In sum, SeaBird believes these actions should help preserve cash and enable it to weather a prolonged downturn in seismic markets.