An arbitration tribunal has delivered a verdict in a drillship order cancellation case involving offshore drilling contractor Northern Drilling and Daweoo Shipbuilding Marine and Engineering (now often called Hanwha Ocean), ruling in favor of Hanwha.

Billionaire John Fredriksen-owned offshore drilling firm Northern Drilling canceled the West Aquila and West Libra drillship orders with South Korea’s Daewoo Shipbuilding & Marine Engineering in 2021, citing delay of deliveries in addition to a repudiatory breach of contract, and stated it could search a refund for installments paid. It additionally stated that “if this declare is disputed, the corporate will search an award by way of London arbitration.”

Northern Drilling had signed agreements with DSME again in Could 2018, to purchase the 2 newbuilding seventh technology DP3 and ultra-deepwater drillships from DSME for $296 million every.

The 2 drillships had been initially ordered in 2013 by Seadrill. Seadrill then in 2016 agreed with DSME for the deliveries to be delayed for 2018 and 2019, however it then in March 2018 canceled the contracts.

The ruling

In an announcement on Monday, saying the arbitration tribunal ruling, Northern Drilling stated: At present, the corporate has acquired the arbitration awards from the tribunal, which have been present in favor of Hanwha.” 

Northern Drilling stated that the tribunal had dismissed its claims and that Hanwha’s claims towards its West Aquila Inc. and West Libra Inc. subsidiaries – by means of which it had ordered after which canceled the rigs – for losses arising from the terminations, curiosity, and prices will likely be decided at a future listening to.

“West Aquila Inc. and West Libra Inc. are disenchanted with the Tribunal’s willpower and are at present contemplating whether or not to attraction. We’ll revert with additional data as soon as a choice on whether or not to attraction has been made,” Northern Ocean stated.

These weren’t the one drillship-ordered cancellations by Northern Drilling with DSME. Again in October 2019, Northern Drilling canceled a resale contract for the seventh technology ultra-deepwater drillship West Cobalt, which had been scheduled for supply from DSME in 2021.

Northern Drilling stated on the time the deal had been canceled for “numerous causes, together with repudiatory breach of contract by DSME”.

DSME then challenged Northern Drilling’s transfer, and in keeping with accessible information, it in December 2019 presupposed to terminate the contract owing to the drilling agency’s alleged failure to pay the remaining installments and for its breach of contract.

The yard reportedly stated on the time it could pursue its authorized and contractual rights in full, together with its proper to get well substantial damages. 

Value noting, the West Aquila drillship, talked about earlier, has since been acquired by the offshore drilling firm Transocean and renamed to Deepwater Aquila. Transocean not too long ago stated it had secured a three-year contract for the newbuild ultra-deepwater drillship “a nationwide oil firm” for work offshore Brazil.