Rig Firm Songa Offshore Misses Forecast with 4Q Loss


OSLO, Feb 17 (Reuters) – Oslo-listed rig firm Songa Offshore said its troubled rig development project Cat D remained on track despite recent setbacks, as it reported fourth-quarter results that lagged expectations on Monday.

The firm had to seek refinancing during the fourth quarter in order to continue with its Cat D project, the development of four tailor-made rigs for oil firm Statoil for working at Norwegian offshore oil and gas fields.

The flagship project became more expensive than planned and threatened to push its debts beyond sustainable levels.

"The company has during the quarter completed a comprehensive refinancing to prepare for the delivery of the Cat D building in 2014 and 2015," Chief Executive Bjoernar Iversen said in a statement.

The firm reported a net loss of $137 million, against expectations for a profit for $19 million according to the mean average in a Reuters poll of analysts, compared with a loss of $219 million at the same time a year ago.

Rig operators and other suppliers have suffered from tightening capital spending from oil companies, which are trying to boost margins and maintain dividends.

Songa, which operates five rigs all under long-term contract with Statoil off Norway, said it expected the market off Norway to remain tight, with increasing demand and limited arrivals of new rigs.

Shares in Songa Offshore were down 1.14 percent at the opening of the Oslo bourse, lagging a benchmark index up 0.32 percent.

(Reporting by Gwladys Fouche, Editing by Terje Solsvik and Mark Potter)


Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.