In an ongoing spat between Fred. Olsen Energy and Korean mega yard Hyundai Heavy Industries (HHI), a rig contract has been cancelled.
Bollsta Dolphin, a wholly owned subsidiary of Fred. Olsen Energy, cancelled the contract for construction of a semi -submersible drilling rig citing delays in the delivery.
Bollsta is asking for a refund of its first instalment of $186m plus accrued interest.
The rig was on 26 October 2012 contracted by Dolphin Drilling, another wholly owned subsidiary of Fred. Olsen Energy, to Chevron, a contract that has since been terminated.
HHI for its part is looking to sue Bollsta Dolphin a claim Fred. Olsen Energy dismissed five days ago as “unfounded”.
The news has sparked debate among Splash readers with one reader commenting: “Another energy company trying to stiff a shipyard on construction costs. When the market recovers, I wonder how many shipyards will remember that they got into this mess by offering sweetheart finance deals to get the contract. In fact, I wonder how many shipyards will be left standing after they eat these rigs.
The loss of the rig contract, worth some $700m, is a bitter blow to HHI which is reeling from continued losses largely down to its offshore exposure. It has just revealed a net loss of KRW451.4bn ($399m) for the third quarter.