Sevan Drilling and Cosco (Qidong) Offshore have agreed to extend a standstill agreement over the building of the deepwater, cylindrical drillship Sevan Developer to 4Q.
The move, which follows an initial standstill agreement, made on September 22, following significant delays in the build of the new deepwater drilling facility and a drop in the market for deepwater units, will give the companies time to negotiate a later delivery date, as an alternative to contract cancellation, Sevan Drilling said today (6 October).
Meanwhile, Sevan says repairs to the BOP and tensioner system on the Sevan Louisiana have now completed and the unit is expected to continue working on its three-year contract with LLOG in the US Gulf of Mexico this week.
The cylindrical unit has been suffering issues since 19 August, when a control system leak was identified. The firm then found the BOP tensioner support systems needed further repair and replacements. The Sevan Louisiana started on contract to LLOG on 28 May. Its construction was completed by Cosco Qidong Shipyard earlier this year.
Sevan said the technical utilization for its entire fleet in 3Q was about 64%, including downtime resulting from the Sevan Louisiana BOP and tensioner system repairs and downtime on rigs in Brazil related to subsea equipment repairs in September.
Sevan has been considering its options for the Sevan developer, including cancelling the contract or negotiating a later delivery date.
The original delivery date had been 30 April 2014. As at 27 August, Cosco's latest indicated delivery date was October 2014. Sevan has said the main reasons for the delay was significant delays in the delivery of critical equipment from Cosco's sub-contractors to the yard. But, the firm has also said marketing the Sevan Developer was "a short term challenge."
According to Sevan, construction of the unit continues to progress at Cosco's shipyard.
Sevan also said its plans to move from Norway to Bermuda would be postponed to 4Q.
Read more: Sevan considers delayed unit's options
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