Petrofac to exit deep-water market, CEO to resume full duties

UK oilfield services provider Petrofac has decided to sell its offshore construction vessel JSD6000 and exit the deep-water market. Petrofac’s chief executive Ayman Asfari will resume full duties following an investigation for suspected bribery, corruption, and/or money laundering.

Petrofac on Thursday confirmed its intention to exit the deep-water market triggering an impairment charge of $176 million (post-tax) in relation to the JSD6000 installation vessel, which has been reclassified as an asset held for sale.

The vessel is available for immediate sale in its present condition and location. The disposal is expected to be completed within 12 months from the end of 2017.

Ayman Asfari, Petrofac’s Group Chief Executive, commented: “We are continuing to reduce capital intensity and enhance returns, evidenced by the disposal of non-core assets and our decision to exit the deep-water market.”

For the full year 2017 Petrofac’s revenues were $6.4 billion compared to $7.9 billion in 2016. The company recorded a net loss of $29 million in 2017 due to impairments and exceptional items of $372 million versus a profit of $1 million in the year-before.

At the end of 2017 the group had order backlog of $10.2 billion compared to $11.7 billion at the end of 2016.

CEO resumes duties, COO quits

The board has concluded that restrictions imposed on Group Chief Executive Ayman Asfari in May 2017 following an investigation by the UK’s Serious Fraud Office are no longer appropriate. He will resume full executive duties with immediate effect and re-join the Nominations Committee, the company said.

Asfari will continue to fully respect and support the process and independence of both the SFO investigation and the sub-committee of the board with delegated responsibility for this matter, Petrofac added.

On the other hand, Marwan Chedid has elected to leave the business to pursue other interests and consequently on Thursday stepped down as Group Chief Operating Officer. He will act in an advisory capacity for a transitional period to assist on his succession. He will remain ring-fenced from the SFO investigation in his temporary advisory role.

Separately, at the Annual General Meeting in May, Non-executive Director and Chairman of the Remuneration Committee Matthias Bichsel will be appointed Senior Independent Director. David Davies will also join the board as a Non-executive Director and will be appointed Chairman of the Audit Committee.

Offshore Energy Today Staff