Prosafe, Cosco in another flotel standstill extension

Prosafe, Oslo-listed provider of offshore accommodation rigs, has entered into another standstill agreement for flotels built by Cosco in China.

There are currently three flotels sitting at the Cosco yard in China, waiting to be delivered to Prosafe: Safe Eurus, Safe Nova, and Safe Vega.

In a statement on Thursday Prosafe said it remained focused on its “fleet high-grading strategy and continues to work with COSCO Shipping (Qidong) Offshore Co. Ltd (COSCO) to find a comprehensive commercial solution for the three Prosafe vessels that currently reside in COSCO’s Qidong shipyard in China.”

The Safe Eurus is in a preserved, strategic stacking mode and negotiations continue with COSCO to find a workable commercial solution, the company said.

Prosafe earlier agreed a deferred delivery of flotel Safe Eurus with the Chinese shipbuilder to 4Q 2019, or such earlier time required by the company, back in July 2016. The flotel was originally scheduled for delivery that year.

Nova, Vega extension

As for the Safe Nova and Safe Vega, the standstill agreement between Prosafe and COSCO has been extended until June 14, 2018.

“Prosafe remains in negotiations with COSCO and related parties for a workable commercial solution for Safe Nova and Safe Vega.“

Prosafe bought these two accommodation rigs from Axis Offshore in 2016 while they were still being built by the Chinese shipyard.

If no agreement is reached, Prosafe says it has the right to claim cancellation of the newbuild contracts due to delay, and claim repayment of the installments paid including interest of around USD 60 million in total, secured by a refund guarantee from Bank of China.

Offshore Energy Today Staff