COSL hits Statoil with lawsuit over terminated rig contracts

China Oilfield Services Ltd. Offshore Management has filed a statement of claim against Statoil with Oslo District Court of Norway over two drilling rig contracts canceled by the operator earlier this year.

Offshore staff

STAVANGER, Norway China Oilfield Services Ltd. Offshore Management (COM, a subsidiary of COSL Drilling Europe AS) has filed a statement of claim against Statoil with Oslo District Court of Norway over two drilling rig contracts canceled by the operator earlier this year.

According to CDE, Statoil terminated theCOSLInnovator’s drilling contract with immediate effect on March 6 with no rate, claiming that conditions for termination had been met. 

At that time, Statoil also suspended the contract of another CDE rig, COSLPromoter, with no rate when it was safe to discontinue well operations. Statoil claimed that the purpose of suspension was to enable CDE to implement the necessary actions to fulfil the requirements of the drilling contract. 

Both rigs were working in theTroll field offshore Norway.

Days after Statoil issued the term notices, on March 18, CSE announced that theCOSLPromoter had resumed operations at a rate equivalent to the average daily income of semisubmersible as disclosed in the company’s 2014 annual report. However, the COSLInnovator remained sidelined.

COM has claimed that Statoil’s termination of the contract was unlawful and has claimed the contract to be maintained. If the contract cannot be maintained, COM says that Statoil is obliged to cover the loss resulting from the unlawful termination, and the exact amount of damages will be subject to subsequent proceedings.

In March, CDE said that theCOSLInnovator had four years and eight months remaining on its contract, with a period of five years and one month remaining on the COSLPromoter’s agreement.

“The company strongly disagrees with the decision of Statoil and has communicated with Statoil on the subject matter. However, the differences between two parties have yet to be resolved,” COM said in a statement issued today.

The claim was filed by Wikborg, Rein & Co. Advokatfirma DA, an international law firm based in Norway, as litigation agent.

12/14/2016

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