Update: Dolphin Drilling might file for bankruptcy

Update: The article has been updated with a statement by Dolphin in which it said the bankruptcy filing would be delayed

Norwegian offshore drilling contractor Dolphin Drilling ASA might file for bankruptcy.

“As repeatedly communicated to the market, the company is insolvent and operating at a loss,” Dolphin Drilling ASA, formerly known as Fred. Olsen Energy, said in a statement released on Monday evening.

As reported in April, the majority of lenders under the company’s $2 billion secured credit facility entered into an agreement for the reorganization and recapitalization of the drilling business of the company.

The agreed recapitalization of the drilling business included the sale of the Bolette Dolphin drillship to refocus the group’s drilling business on its mid-water fleet while the mid-water drilling business of the group was agreed to be transferred to a new holding company, controlled by the secured lenders.

Dolphin Drilling ASA said on Monday that that following the secured lenders’ agreement to carry out a recapitalization as reported in April, “the company has made best efforts to facilitate an agreement on the Drilling Recapitalization among all relevant creditors.”

However, Dolphin Drilling ASA said, despite the company’s notable efforts, such agreement has not been possible to achieve.

“The company’s secured lenders have made it clear that the Drilling Recapitalization will be implemented on a non-consensual basis if a consensual implementation is not viable.”

“On this background, the board of the Company has resolved to file for bankruptcy unless the relevant creditors and the Company agree on the Drilling Recapitalisation (or any other restructuring alternative) by 2 PM on Tuesday 25 June 2019.”

Update: 2:02 – pm June 25, 2019 – Bankruptcy filing postponed

Dolphin Drilling at 2:00 pm CET in Tuesday issued an update in which it said that creditors had requested some additional time to try to obtain an agreement on the Drilling Restructuring.

“On this basis, the board has resolved to move the deadline for such agreement to 10 AM on Wednesday 26 June 2019.  The board reiterates that the Company will remain insolvent even if the Drilling Restructuring is implemented on a consensual basis,” Dolphin Drilling ASA said.