Sevan Drilling and Cosco (Qidong) Offshore have come to an agreement over the delivery of the new-build Sevan Developer cylindrical drilling rig.
The deepwater unit is being built by Cosco, but has faced construction delays. Meanwhile, Sevan has seen a slowdown in contract awards for deepwater units.
Sevan had agreed a standstill arrangement with Cosco over the rig. Now, the two companies have agreed to defer the Sevan Developer's delivery date for 12 months with mutually agreed options, exercisable at six month intervals. This will extend the delivery date for up to a total of 36 months from 15 October 2014.
Cosco will complete construction and maintain the rig at the shipyard in Qidong. Sevan will continue to market the rig as part of its fleet and delivery will take place only after a drilling contract is in place that is sufficient for secured financing to be obtained, said Sevan.
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. Sevan also said marketing the Sevan Developer was "a short term challenge."
Meanwhile, Sevan said the Sevan Louisiana started earning operational dayrate under its contract with LLOG in the Gulf of Mexico on 7 October. Sevan is currently in discussions with LLOG regarding the allocation of contractual liability and commercial consequences with respect to the downtime experienced during the third quarter.
The cylindrical unit had 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 had first started its contract to LLOG on 28 May. Its construction was completed by Cosco Qidong Shipyard earlier this year.
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