Norwegian offshore vessel operator Havila has terminated the contract with DeepOcean for the Havila Phoenix vessel, citing the latter's breach of contract obligations, and seeking payment.
The subsea vessel Havila Phoenix has since 2013 served DeepOcean, under a charter with a firm period until May 2023. The deal included further extension options beyond May 2023.
However, Havila said on Friday that DeepOcean had in mid-November sent a letter to the company regarding DeepOcean's intention to seek protection under British law for wind up of the UK based activities, including the company that has chartered Havila Phoenix.
"After having finalized the project Havila Phoenix was engaged in at receipt of the letter mentioned, Havila Shipping ASA has received no instructions regarding further use of the vessel," Havila said,
"DeepOcean has, as a result of their activities, or lack of activities, ended up in breach of contractual obligations, including payment default," Havila said.
"Havila Shipping ASA, today has, as a consequence, terminated the charter party. Further, Havila Shipping ASA has requested payment from DeepOcean Group Holding BV in Netherland under the Parent Company Guarantee issued to fulfill the chartering company’s contractual obligations," the company added.
Restructuring
On November 18, DeepOcean, a subsea services to the global offshore energy industry, said it had started a restructuring process in relation to three UK subsidiaries in its Cable Laying and Trenching business (the “CL&T Group”), "which will enable the CL&T Group to be wound down on a solvent basis."
Øyvind Mikaelsen, CEO of DeepOcean said at the time: "Despite our long-term commitment to the cable lay and trenching division, it has been loss-making for some time. We have invested and explored structural alternatives to turn around the business. However, the division is not sustainable and there is no prospect of it becoming profitable under current market conditions and with current contractual obligations.”
“Unfortunately, we have come to the difficult decision to propose an orderly wind-down of the business is the only viable option. This provides the greatest certainty to affected employees and facilitates protection for creditors. This allows the rest of the Group to move to a secure financial footing and continue to provide jobs and create value for stakeholders.
At the time of writing, DeepOcean's website still shows the Havila Phoenix vessel among its assets.
Built in 2009, the 127,4 meters long Havila Phoenix is a dynamically positioned construction vessel, which can be used for offshore construction, installation, and trenching support.