Lamprell Delivers New Rig, Appoints Chairman
by Jon Mainwaring
Friday, June 15, 2012
United Arab Emirates-based Lamprell received a positive response to updates it made on Friday that it had successfully delivered an offshore drilling platform to Compañía Perforadora Mexico (PEMSA) and appointed a new chairman.
Lamprell, which supplies specialist engineering services to the oil and gas and renewables industries, said the fabrication of Hull 108 was completed on time at its Sharjah yard. Hull 108, designed by Friede & Goldman, is a completely outfitted and equipped Super M2 self-elevating mobile offshore drilling platform; it is designed to operate in water depths of up to 300 feet and has a rated drilling depth of 30,000 feet.
Meanwhile, Lamprell has appointed John Kennedy to its board of directors as a non-executive chairman with immediate effect. Kennedy, Lamprell said, is a "highly experience engineer" who has spent most of his executive career in the oil field services sector. He held the position of executive vice president at Halliburton from 2003 to 2011.
Lamprell's directors have received a lot of criticism in recent weeks after the firm put out a profit warning on June 7. Lamprell, which had estimated a full-year profit of $38.5 million as recently as mid-May, stunned investors by stating it now expected a loss of between $15 million and $20 million.
In May, the firm warned that its business had been adversely affected by delays in key specialized vendor equipment deliveries for new-build jack-up projects together with slippage in the timing of new project awards.
As a consequence of the June profit warning, Lamprell's shares – which are listed on the London Stock Exchange – lost almost a third of their value before Friday's announcements provoked a bounce.
According to oil analysts at London-based investment bank Oriel Securities the Hull 108 rig is of a different design to the LeTourneau 116E drilling rigs – which Lamprell is building for National Drilling Company, Abu Dhabi – that have recently been subject to cost overruns.
Oriel said that the delivery of Hull 108 "will trigger another bullet payment from PEMSA which Lamprell will use to repay a further $70m of debt, reducing net debt to around $20m and demonstrating the underlying strength of the group's balance sheet".
Overall, Oriel's analysts greeted Friday's announcements as somewhat positive, albeit with a caveat.
"Although the delivery of Hull 108 does not provide any comfort that Lamprell is progressing with the issues on the Le Tourneau 116E rigs it does reaffirm Lamprell's capability in rig construction, and demonstrates the strength of the balance sheet," said the bank.
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