PGS Drops Guidance, Postpones Vessels

Oslo-listed seismic player Petroleum Geo-Services (PGS) said today it expects lower earnings for this year and a further decline in profits in 2015 due to drop in oil prices and exploration cost cuts by the offshore oil companies.

The company expects its EBITDA to be around $700 million for the year 2014 while setting up a 2015 guidance somewhere in between of $550 and $700 million. Earlier in its Q3 report, PGS estimated full year EBITDA to land at approximately $725 million.

In order to cut costs the company announced that it will be postponing the deliveries of its newbuild seismic vessels Ramform Tethys and Ramform Hyperion, lowering the capital spending from estimated $375 million in 2014 to approximately expected $250 million in 2015.

Both vessels have been rescheduled for the delivery in 2016. Ramform Tethys’ new scheduled delivery is for the first quarter 2016 and Ramform Hyperion planned for the third quarter same year.