Right time to swoop on distressed offshore players?
DECEMBER 18, 2015 — Oslo, Norway, headquartered international law firm Wikborg Rein says current low oil prices could mean there are bargains to be had for investors in the offshore sector who
offshore
Seacor eyes spin off of offshore business
NOVEMBER 30, 2015 — Seacor Holdings Inc. (NYSE: CKH) is positioning itself for a potential spin off of its offshore marine subsidiary, Seacor Marine Holdings Inc. (SMH). Seacor Holdings has agreed to
Criminal charges filed in West Delta 32 platform fire case
According to the indictment, the defendants were involved in different capacities while construction work was being done of the West Delta 32 platform when it exploded.
Black Elk Energy Offshore Operations LLC and Grand Isle Shipyards Inc. are charged with three counts of involuntary manslaughter, eight counts of failing to follow proper safety practices under the Outer Continental Shelf Lands Act (OCSLA) and one count of violating the Clean Water Act. Wood Group PSN Inc., Moss, Dantin and Srubar are charged with felony violations of OCSLA and the Clean Water Act.
The Outer Continental Shelf Lands Act and federal regulations govern welding and activities that generate heat or sparks, known as “hot work,” on oil production platforms in U.S. waters. Because this work can be hazardous and cause explosions, regulations mandate specific precautions that must be taken before the work can commence. For instance, before hot work can be performed, pipes and tanks that had contained hydrocarbons must be isolated from the work or purged of hydrocarbons. Gas detectors and devices used to prevent gas from traveling through pipes must be used. According to the Indictment, these safety precautions were not followed and an explosion causing the deaths of three men and a spill resulted
“Workers lives can depend on their employer’s faithfulness to the law, not least of all those working in oil and gas production where safety must be a paramount concern,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and natural Resources Division. “The Justice Department is committed to enforcing the nation’s bedrock environmental laws that protect the environment, and the health and safety of all Americans.”
“The energy sector represents a vital industry in this region, but its work must be performed responsibly,” state U.S. Attorney Kenneth Polite for the Eastern District of Louisiana. “Today’s indictment underscores that we will hold accountable all parties – both businesses and individuals – whose criminality jeopardizes our environment or risks the loss of life.”
“Developing domestic sources of energy must be done responsibly and safely,” said Assistant Special Agent in Charge Dan Pflaster of EPA’s Criminal Enforcement Program in Louisiana. “EPA will continue to work with its law enforcement partners to hold companies fully accountable for illegal conduct and to assure compliance with laws that protect the public and the delicate Gulf Coast ecosystem from harm.”
The Department of Justice notes that “an indictment is only an allegation of wrongdoing and the defendants are presumed innocent unless proven guilty at trial.”
The case was investigated by the U.S. Department of Interior Office of Inspector General and EPA’s Criminal Investigations Division. The case is being prosecuted by Emily Greenfield of the U.S. Attorney’s Office for the Eastern District of Louisiana and by Kenneth E. Nelson of the Environmental Crimes Section of the Department of Justice.
GulfMark Offshore files $250 million shelf registration
The form S3 positions the offshore services company to sell up to $250 million in securities “from time to time after the effective date of this registration statement, as determined by the registrant.”
The filing says that the company “will use the net proceeds from the sale of securities sold by us for general corporate purposes, which may include the repayment of debt, acquisitions, capital expenditures and working capital. We may temporarily invest funds we receive from the sale of securities by us that we do not immediately need for these purposes.”
According to the filing, in the nine months ended September 30, 2015, Gullmark Offshore’s losses from continuing operations were $198.6 million.
Vard: One new order, a lot more red ink
First the good news: It’s an order for an offshore vessel of undisclosed type or size, for an undisclosed owner, at an undisclosed price. Designed by Vard Design in Ålesund, Norway, the vessel’s hull will come from the Vard Braila shipyard in Romania, with outfitting and delivery scheduled from Vard Langsten in Norway in 2017.
Now to the mounting losses. Vard recorded a net loss of NOK 845 million ($1($98.4 million) and NOK 1.1 ($128 million) for 3Q2015 and 9M2015, against a loss of NOK 160 million ($18.6 million) and profit of NOK 30 million ($3.5 million) respectively in the corresponding 2014 periods. The third quarter loss attributable to equity holders came at NOK 486 million ($56.5 million), as compared to a loss of NOK 37 million ($3.4 million) in 3Q2014.
Over the first nine months of the year, cash holdings declined from NOK 2.0 billion ($232 million) to NOK 906 million ($105 million) as at 30 September 2015 on the back of capital-intensive projects requiring a significant amount of working capital, and the cash impact of losses in Brazil. However, cash holdings remained stable in the third quarter compared to the balance of NOK 904 million at the end of 2Q2015.
Although orders picked up in the third quarter, with four new vessel contracts secured, total order book value at September 30 was NOK 14.01 billion ($1.6 billion) — a 30% decrease from the third quarter 2014 figure.
Currently, Vard has an order book of 31 vessels, of which 18, or 58%, will be of its own design.
Vard is winning some work outside of its traditional North Sea market and in non-offshore related specialized vessels. Still, that’s not been enough to offset the impact of continuing offshore weakness in its European shipyards and of lower utilization and cost overruns at its Brazilian shipyards, where “additional loss provisions were required to account for unsatisfactory progress.”
“In particular,” says the company, “the scope and complexity of the series of LPG carriers under construction at [50.5% owned subsidiary] Vard Promar exceeds original assumptions, while the efficiency and operational stability at the new yard is still lower than anticipated.”
Downsizing continues at Vard’s Niterói Brazil yard in line with a declining workload.
Activity levels at Vard’s shipyards in Romania and Norway continue to decline on the back of a shortfall of sizeable new orders and postponement of deliveries in the current order book.
In Vard Tulcea, the larger of its two shipyards in Romania, a restructuring process is underway and a number of engineering resources have been subcontracted to Vard’s parent group Fincantieri in order to retain highly skilled staff in the organization. Vard Tulcea has also delivered first steel sections to Fincantieri cruise shipbuilding projects, and opportunities are being evaluated how the yard can carry out a larger share of such project.
In Norway, temporary layoffs are being imposed.
Operations and yard utilization at the Vietnam shipyard, Vard Vung Tau, are said to “remain robust.”
Vard says that work is underway on a comprehensive strategy overhaul and development of a new business plan which it will unveil when it releases its full year figures.
It says a key element of that plan will likely be a diversification of production, with synergies with the Fincantieri parent group expected to play a major role.
Vard says its “exposure to the Brazilian market is under review.”
Heavy well intervention vessel punches above its weight
OCTOBER 14, 2015 — Ulstein Design and Solutions BV and German deep drilling systems specialist Herrenknecht Vertical GmbH are using this week’s Offshore Energy 2015 exhibition in Amsterdam to present a future
Master Mariner takes the helm at EMAS Offshore
He succeeds Jon Dunstan, who has resigned to pursue other interests outside of the company but will remain with it to hand over and assist Captain Kumar until February 2016.
Capt. Kumar, 55, has more than 25 years of experience in the marine industry. Prior to his appointment as CEO, he was Group Chief Operating Officer and executive director of EMAS Offshore’s parent, Ezra Holdings Limited. He has stepped down from those positions to concentrate on his new role with EMAS Offshore.
Prior to joining Ezra, he was an Assistant General Manager of Malaysian based offshore support services provider Bumi Armada Navigation Sdn Bhd.
Capt. Kumar is a qualified Master Mariner and holds a Certificate of Competency as Master of a Foreign Going Ship issued by the Malaysian Marine Department. During his seagoing career he held various positions onboard Malaysian International Shipping Corporation vessels.
“With his vast number of years of experience in the offshore industry, Capt. Kumar is a strong business leader we are fortunate to have in today’s challenging oil and gas environment,” said Mr. Lee Kian Soo, EMAS Offshore’s Executive Chairman. “He will be able to bring strategic insights to drive EMAS Offshore’s performance, maintain our leading position in Asia, and penetrate West Africa, which we have identified as a key market for us to grow in.”
TTS Group: first the good news, then the other
The total order value is approx. MNOK 112, under construction at Daewoo Shipbuilding & Marine Engineering Co, South Korea, for Maersk. TTS has previously delivered similar equipment between 2012 and 2014 for another 20 vessels built at same shipyard for same shipowner.
The winches will be manufactured at TTS’ factory in Korea and deliveries will take place 2016 – 2017.
The less good news comes from subsidiary TTS Offshore Solutions AS in Bergen, Norway. It is to implement temporary workforce reductions with immediate effect.
A workforce of approximate 30 full-time equivalents will be temporary laid off, while another approximate 20 full-time equivalents will be contracted out to other TTS companies.The adjustment affects approximate 40 percent of the workforce of TTS’ offshore operations in Norway and Poland.The adjustments are in response to the current offshore market situation.
Eni finds supergiant gas field in Egyptian deepwater
AUGUST 31, 2015 — Italian based energy major Eni has discovered what it calls a “supergiant” offshore gas field at its Zohr Prospect, in Egyptian economic zone deepwater. Eni says that, according
Boskalis reports high profit half year
AUGUST 21, 2015 — Papendrecht, Netherlands, based Royal Boskalis Westminster N.V.yesterday reported a very busy first half year with historically high profit, with good results from all the company’s major operating segments: