Thursday, July 13, 2000

Aker Maritime to end Gulf yard joint venture
Yesterday, the news from Aker Maritime was that it had bought a big piece of Kværner. Today the firm told the Oslo stock that it is ending its dissolve its joint ownership arrangement with Peter Kiewit Inc. in offshore yard operator Aker Gulf Marine, Ingleside, Texas.

It said in a statement to the Oslo bourse that it would either sell its 51 percent stake to Peter Kiewit or buy Kiewit's 49 percent holding. The price of the yard has been set at $175 million and Aker Maritime will make its on whether to buy or sell by August 23.

Bergesen makes $9.4 million on Kværner shares deal, but shows an accounting loss of $24.3 million
It's amazing what an accountant can do with a sharp pencil. The total proceeds from Bergesen d.y.'s sale of shares and subscription rights in Kværner amounts to NOK 1,158.3 million, the company said today. The gain from the sale thus amounts to NOK 64.1 million.

From the first quarter 2000, Bergesen's financial reporting is being made in U.S. dollars. In the dollar accounting, the deal will produce a gain of $9.4 million, but a currency exchange rate loss of $33.7 million. On the books, the deal will show up as an accounting loss of $24.3 million. The accounting loss. in its entirety, will be booked in the second quarter.

As a result of the conversion to financial reporting in dollars, the book value of the shares in Kværner were set at the dollar value at the time of acquisition. The currency loss for accounting purpose arises because of the development of the NOK/$ exchange rate from the time of acquisition until the shares were sold.

World orderbook up again
According to figures from this month's World Shipyard Monitor published by Clarksons, the world shipbuilding orderbook continues to increase and has now edged up to 105.6 million dwt. This represents a two million dwt increase.

Clarksons says it is the tanker orderbook, in addition to the container orderbook and a 300,000 dwt increase to the LNG orderbook. that continues to drive the upward momentum. The Aframax orderbook saw the biggest rise, up by 6 vessels of 800,000 dwt, while there was also movement in the Panamax sector following the Exmar deal at Daewoo for four 70,000 dwt vessels.

Meanwhile, the bulk carrier orderbook edged up by just 200,000 dwt, reflecting the fact that contracting has slowed considerably. With the Panamax orderbook representing 22.4% of the fleet, Capesize 14.8% dwt of the fleet and Handymax 18.6% of the fleet, owners are reluctant to commit themselves to newbuildings

Cabot LNG sold
Tractebel, one of Europe's five largest power generation companies, has purchased Cabot Liquefied Natural Gas (LNG) for $680 million. Tractebel will acquire Cabot's LNG terminal in Everett, Massachusetts, Cabot's 10 percent interest in a liquefaction facility in Trinidad and Tobago, and Cabot's LNG tanker, Matthew. The transaction is expected to close in late August 2000.

The 1979-built Matthew, managed by Osprey Maritime, was refurbished at Baltimore Marine Industries in 1998 after 17 years in lay-up.

Cabot LNG is the only active importer and distributor of LNG on the U.S. East Coast. Headquartered in Boston, it operates an LNG import terminal in Everett, Massachusetts and supplies 20 percent of the total New England gas market. The LNG is distributed to utilities, electric power generators, gas marketing companies and industrial end users in New England. Cabot LNG has 86 employees.

Rowan reports Improved financial results
`We definitely see a light at the end of the tunnel -- and we believe it is the blue flame from natural gas in the Gulf of Mexico! With contracts for 12 of our 21 rigs expiring within the next two months, we will have ample opportunity to become an early cycle beneficiary. We shall see.'' That was the view of Rowan Companies, Inc, chairman and CEO C. R. Palmer when he reported that, for the three months ended June 30, 2000, Rowan Companies, Inc. generated net income of $11.1 million, or $.12 per share, on revenues of $143.2 million, compared to a net loss of $2.6 million, or $.03 per share, on revenues of $119.2 million in the second quarter of 1999.

Palmer commented, "Quarter- to-quarter comparisons reflect the improving environment in the volatile contract drilling business. Rowan's offshore rig utilization was 95% during the second quarter of 2000, versus 68% in the second quarter of 1999 and 86% in the first quarter of 2000. Our average offshore day rate during the second quarter of 2000 was $42,700, versus $45,200 in the second quarter of 1999 and $42,600 in the first quarter of 2000.

"The combination of higher day rates and increased utilization resulted in our best second quarter performance in two years.

"We believe that the Gulf of Mexico continues to offer the brightest prospects for the future. Industry activity in the area continues to increase, as does Rowan's rig fleet. We have relocated five rigs from the North Sea over the past 12 months and added the newbuild Gorilla VI during June. Following the scheduled relocation during the third quarter of Gorilla II from offshore eastern Canada, Rowan will have 21 rigs in the Gulf of Mexico and two in Canada."


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