SBM claims compensation for platform costs

The Yme and Deep Panuke platforms both now are installed at their locations offshore Norway and Nova Scotia, according to contractor SBM Offshore.

Offshore staff

MONACO – The Yme and Deep Panuke platforms both now are installed at their locations offshore Norway and Nova Scotia, according to contractor SBM Offshore. Both were built in Abu Dhabi.

Commissioning activities and remaining construction works continue in order to complete and prepare the facilities for start-up of production.

However, due to one client recently having revised its contractual position, and a re-measurement of remaining on-site works, SBM has raised its forecast net costs for the two platforms.

With both projects, the company has failed to reach a settlement with its clients for additional compensation. It has therefore initiated legal action, in the case of the Deep Panuke platform, and arbitration proceedings for the Yme platform, against the respective clients.

SBM adds that it will continue both actions to pursue maximum cost recovery.

Due to the uncertainty over securing satisfactory compensation for its claims, the company will book an impairment charge of $450 million under the Lease and Operate segment of its H1 2011 results, due to be published in mid-August.

SBM stresses that its more recent major projects are on schedule and are performing in line with or above expectations.

07/28/2011

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