Dolphin Disputes Contract Termination
Dolphin A.S., the wholly owned subsidiary of Fred.Olsen Energy ASA, received May 23, 2002 notice of termination regarding the contract for the drilling rig Byford Dolphin from Statoil. Originally, the contract expires on October 9, 2002, however, Statoil demands termination as soon as the rig has secured 3 wells on the Sigyn field in accordance with the requirements of the Norwegian Petroleum Directorate (NPD).
Dolphin rejects the basis for the termination, and Statoil has been notified accordingly.
Following the tragic accident on Byford Dolphin on April 17, 2002 when a Dolphin employee died, an investigation committee was established, comprising representatives of the partners in the Sigyn project; Statoil, Esso and Dolphin. The mandate of the committee was primarily to review the incident and to submit recommendations regarding possible actions and amendments in order to prevent similar accidents in the future. The mandate comprised both immediate actions as well as long term measures and changes in procedures. The work of the committee led to a number of immediate actions on the Sigyn project, and the rig was back in operation on the field 7 days after the accident.
In parallel, the committee continued its work according to the mandate, and a final report was submitted May 23rd in connection with a presentation to the NPD. The report identifies factual circumstances and recommends a number of measures in order to improve the safety on the Sigyn project. To Dolphin it is highly surprising that Statoil issues a notice of termination the same day the report is being submitted and the findings of the report is reviewed and evaluated by the various partners in the Sigyn project.
Byford Dolphin has for long time been working for Statoil with excellent efficiency and in compliance with prevailing safety regulations on the Norwegian continental shelf. On several occasions Statoil has referred to the impressive operational performance of the rig and its focus on health and safety. Immediately after the accident, Dolphin engaged itself in an open and comprehensive cooperation with Statoil in order to review all routines and procedures for Norwegian drilling operations. Statoil's decision to terminate the contract is therefore totally incomprehensible to Dolphin.