Husky Oil Operations has cancelled its charter of Seadrill’s drilling rig West Mira, which follows the termination of the rig’s construction contract at Hyundai Heavy Industries (HHI) last week.
“Due to the late delivery of the unit, the company had tentatively agreed with Husky to reduce the day rate on the West Mira. The construction contract was subsequently cancelled by Seadrill due to the shipyard’s inability to deliver the Unit within the timeframe required under the contract,” Seadrill said today in an exchange filing.
The five-year charter would have seen the rig employed in drilling in offshore Canada and Greenland, and had a total base revenue potential of around $1bn. The contract was signed between Seadrill and Husky at the end of 2012.
The delivery date stated in the HHI construction contract was by December 31, 2014, but Seadrill cancelled its order for the delayed rig on September 16.
The rig itself is a sixth-generation ultra-deepwater semi-submersible drilling unit for use in ‘harsh’ environments.
Seadrill said it is still in discussions with Husky to find an alternative solution to meet its drilling requirements.