FEBRUARY 27, 2017 — Singapore Technologies Engineering reports that its wholly-owned U.S. shipbuilding subsidiary, VT Halter Marine, Inc., Pascagoula, MS, is involved in arbitration proceedings in New Orleans with Hornbeck Offshore Services, LLC.
According to a Singapore stock exchange announcement, the arbitration proceedings involve issues and disputes arising from a vessel construction agreement dated November 14, 2011 between VT Halter Marine and Hornbeck Offshore Services (HOS) for the design and construction of certain vessels by VT Halter Marine for Hornbeck. Hornbeck had claimed damages against VT Halter Marine mainly on the basis that the vessels constructed by VT Halter Marine pursuant to the agreement had alleged errors in design and construction.
Out of the damages claimed, the amount that was initially quantified by Hornbeck was approximately $15.2 million. Hornbeck subsequently revised the amount of quantified damages claimed to approximately $43.5 million, according to Hornbeck’s preliminary damage calculation received by VT Halter Marine in December 2016. Following this, VT Halter Marine and its legal advisers took time, effort and due diligence to consider and assess the revised sums claimed as well as the potential defenses.
The stock exchange announcement says that VT Halter Marine has asserted counterclaims against Hornbeck for approximately $3.3 million and will continue to vigorously defend its position. There is no change to the full year results for the financial year ended December 31, 2016.