The incremental $18 million augments the $40 million announced on September 6, 2005. Addressing the apparent need to so quickly supplement the capital expansion program announced earlier this month, John Huff, Chairman and Chief Executive Officer, was pleased to reiterate, "We are making these organic growth investments in response to the escalation in market demand for the niche market products and services we provide."
Five of the six ROVs have long-term work commitments, four to deliver construction services and the fifth to provide drill support, offshore West Africa and Norway. The sixth vehicle is being built for use in the Gulf of Mexico (GOM) spot construction market. The committed ROVs have expected contract commencement dates ranging from January through May of 2006.
The 3-man IMCA-compliant SAT system is being built in response to GOM market demand emanating from the extensive pipeline and platform damage caused by Hurricanes Ivan, Katrina, and Rita. This SAT system is expected to be deployed on either a chartered vessel or barge for service commencing in early 2006.
Commenting on the new additions, Mr. Huff noted, "The six ROVs bring our 2005 announced new build and vehicle acquisitions to a total of 24 systems. We anticipate that ROV demand will continue growing through 2006 and intend to add more vehicles to our fleet as opportunities present themselves.
"The SAT system will enable us to escalate our business participation in the repairs of damage caused by the three major GOM hurricanes in the past year. Such work is currently anticipated to last for the next few years. Longer term, the aging GOM infrastructure and growing operator preference for state-of-the-art equipment supplied by companies committed to rigorous planning, execution, and safety standards should enable us to keep this system working at a high utilization rate."
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