Fred. Olsen Energy plans to get rid of another rig amid refinancing efforts

Offshore driller Fred. Olsen Energy (FOE) plans to sell the drillship Bolette Dolphin as part of its ongoing refinancing efforts. 

Back in October, FOE revealed its decision to scrap two of its drilling rigs, one semi-submersible and one drillship. Both units were in lay-up at the time of this decision.

Regarding its ongoing refinancing efforts FOE said on Tuesday it had presented to its stakeholders a new refinancing proposal.

The key elements of the proposal include the sale of the company’s drilling unit Bolette Dolphin, the issuance of new equity in the amount of approximately $130-140 million in consideration of approximately 89% of FOE’s share capital, post refinancing, and the issuance of new loan capital in the amount of approximately $90 million.

The proposal also included plans for the settlement of all outstanding secured debt by a payment of approximately $580 million, in addition to certain minor payments depending on the value of certain additional assets.

Finally, the proposal included the settlement of all outstanding bond debt by a conversion of such debt into equity representing approximately 10% of FOE’s share capital, post refinancing (representing a value of approximately $15 million), in addition to certain minor payments depending on the value of certain additional assets.

The existing shares of the company will represent approximately 1% of the share capital post restructuring (representing a value of approximately $1.5 million).

Following refinancing, FOE said it would continue as a four drilling unit company, including Blackford Dolphin, Bideford Dolphin, Borgland Dolphin and Byford Dolphin.

FOE also said it would continue its discussions with its key stakeholders with the aim of securing the necessary support for its implementation, and noted that the proposal remains subject to change.

It is worth reminding that during 3Q 2018 FOE recorded revenues of $18 million, which is a decrease from revenues of $76.3 million in the prior-year quarter. The company also saw its net loss deepen during the third quarter of 2018 totaling $102.6 million compared to a loss of $45.7 million in the same period of 2017.

Bolette Dolphin was built in 2013 by Hyundai Heavy Industries in Ulsan, South-Korea. The 6th generation drillship is of a Gusto P10000 design.

Offshore Energy Today Staff