Songa Produces Robust 3Q 2015 Operating Profit

Rig operator Songa Offshore reported Friday a strong operating profit at the EBITDA level for its third quarter.

Songa – which reported Wednesday this week that three of its rigs achieved operational efficiencies of 100 percent during October – said that its EBITDA amounted to $64 million during 3Q 2015, compared to $60 million in the previous quarter and $41 million in 3Q 2014.

The firm said that its Songa Dee (mid-water semisub) rig is continuing a drilling and workover campaign on the Gullfaks field, while its Songa Delta (mid-water semisub) rig continues to drill 'fast track' production wells on the Oseberg field. Its Songa Trym (mid-water semisub) rig drilled exploration wells in the UK and Norway during the quarter, but its drilling contract with Statoil will finish when the current well, Tarvos, is completed next week. Songa said it will receive a cancellation fee in relation to the Songa Trym contract.

Songa Dee, Songa Delta and Songa Trym have all seen their quarterly operating expenses fall this year when compared to the last quarter of 2014. The average operating cost per rig currently stands at $137,000 per day, compared to $171,000 per day towards the end of last year.

Songa Dee and Songa Delta are contracted with customers through to 3Q 2016. Meanwhile, Songa has four new-build 'Cat D' rigs either delivered or about to be delivered that each have eight-year firm contracts. The firm's total backlog of orders amounts to $5.7 billion with a further $7.8 billion in rig contract extension options.

Songa Offshore CEO Bjørnar Iversen commented in a company statement:

"The Cat D project has advanced to another phase with Songa Equinox (mid-water semisub) arriving in Norway in October and progress of mobilization and construction of the other newbuilds on track. We target to get Songa Equinox on day rate late November at the same time as Songa Endurance (mid-water semisub) will arrive in Norway and we take delivery of Songa Encourage.

"Clients' acceptance testing and the Acknowledgement of Compliance (AoC) process are both progressing well. We are also satisfied to see that our existing fleet continues to deliver high uptime, as well as safe and cost efficient operations."



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