Brazilian oil company Petrobras has lost a $400 million case against Paragon Offshore Nederland, a former supplier of offshore drilling rigs for oil and gas exploration.
Petrobras said Thursday that the Court of Justice of Rio de Janeiro decided, by majority vote, to grant the appeal of Paragon Offshore.
Petrobras said that the estimated value of the lawsuit was R$1.9 billion (around $401 million) of which R$ 59 million (around $12,45 million) has been provisioned and the remaining amount is classified as a possible loss in the company's 2021 Financial Statements.
"Petrobras will file the appropriate appeals against this decision and informs that there was no change in the expected loss. Facts deemed relevant about this process will be timely disclosed to the market," Petrobras said.
Paragon Offshore used to lease offshore drilling rigs to oil and gas companies. The company, created as a Noble Corp. spinoff in 2014 with older drilling rigs, was acquired by Borr Drilling in 2018.
Petrobras did not go into details about the case, however, it is worth noting that there had been a spat between the two companies in 2015 when Petrobras said it would cancel contracts for Paragon DPDS2 (built in 1981), and the Paragon DPDS3 drillships, built in 1963).
Paragon at the time said that as of June 30, 2015, the two drilling contracts had constituted $493 million of contract drilling services backlog with Petrobras, and that it would vigorously defend its rights under the contracts.