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Logitel Offshore delays two accommodation vessels at Cosco yard

Logitel Offshore delays two accommodation vessels at Cosco yard
Joint venture firm Logitel Offshore has entered into an agreement with China’s Cosco (Nantong) Shipyard to delay the delivery of two floating accommodation vessels.

Logitel Offshore, established in 2013 between Sevan Marine and CeFront Technology, said the agreement is to push back the delivery of one vessel for up to 12 months until October 2016, and postponement of work for 120 days for the second unit.

Oslo-listed Sevan Marine announced that this development will lead to “delays in payment to Sevan Marine in relation to these two vessels and increases the risk that options for further newbuilds will not be called off and/or such call offs will be delayed.”

The company added that “these factors, combined with the market outlook, are expected to lead to a non-cash impairment in the range of $35-40m in the carrying value of the convertible loan and accrued interest.”

In its first quarter results announced on 19 May, Sevan Marine had mentioned that an option for a fourth accommodation vessel with Cosco will not be exercised, and that the option has expired on 30 May.

The floating accommodation units are based on Sevan Marine’s cylindrical hull design, which is perceived to bring in the benefits of lower cost, higher deck load capacity, better stability and more storage space.

Last week, Axis Offshore has also made an agreement with another of Cosco’s yard in Qidong to delay the delivery of an accommodation rig until 15 July 2016, from the scheduled Q1 delivery this year.