In its Q2 2021 results, DOF Subsea reported improved operating revenue and fleet utilisation, but noted the group’s financial position is ‘not sustainable’
However, the Oslo-listed offshore vessel owner is continuing “challenging, but constructive” dialogue with lenders on a long-term solution to restructure its debt. Standstill agreements have been agreed until 31 August 2021 with 88% of the secured lenders within the DOF Subsea Group. Bondholders could extend this period until 30 September 2021.
Like other OSV owners, DOF Subsea noted continuing challenges during the quarter resulting from Covid-19 travel restrictions and the market oversupply of tonnage that is depressing charter rates.
In its financial reporting, DOF Subsea showed a 35% improvement in its operating revenue for the quarter year-on-year, with Nkr1,207M (US$136M) in Q2 2021, up from Nkr894M (US$101M) in Q2 2020. EBITDA for Q2 2021 was weaker year-on-year, however, Nkr296M (US$33.6M), down from Nkr361M (US$40.9M) in 2020.
Overall, utilisation of the DOF Subsea fleet increased to 83% in Q2 2021, up 74% year-on-year.
DOF Subsea reported a backlog of Nkr10Bn (US1.1Bn), Nkr5.2Bn (US$590M) from its DOFCON Brazil joint venture. Some Nkr1.7Bn (US$193M) of this backlog was secured after Q2 2021 ended.
Long-term contracts in Brazil, APAC
Prior to the release of its results, DOF Subsea reported securing multiple long-term charters in Brazil and the Asia Pacific (APAC) region.
In Brazil, state-run oil and gas company Petrobras awarded three-year charter contracts for the pipelay support vessels Skandi Vitória and Skandi Niteroi, via joint venture partner TechnipFMC and via Norskan Offshore Ltda, a fully owned DOF ASA Company, respectively.
Built in 2010 and 2011, both Skandi Vitória and Skandi Niteroi are STX OSCV 06 designs, with an overall length of 142.2 m, beam of 27 m, draught of 8.5 m and accommodation for 120.
Both vessels are under DNV class, Brazil-built and flagged and owned by DOFCON Navegação Ltda, a 50-50 joint venture between DOF Subsea and TechnipFMC. Operations will start in February 2022.
In APAC, DOF Subsea secured multiple contract awards “providing significant utilisation for resources and vessels in Q3 and Q4 2021 and securing solid backlog into the H1 2022,” the company said.
Onshore works are underway for several offshore campaigns that will utilise the construction support vessel Skandi Hercules and the onshore and offshore teams from Q3 2021 into Q1 2022. The first campaign will support maintenance activities at an offshore facility in the Timor Sea for a short duration. Following this, Skandi
Hercules will be deployed on several construction and pre-commissioning support campaigns off the northern Australian coast.
Onshore works are also underway for several offshore campaigns that will utilise the dive support vessel Skandi Singapore in saturation diving mode in the region during 2022.
DOF Subsea said it will provide “a high-specification vessel and related subsea services to undertake a significant pre-commissioning and commissioning support campaign off the northern Australian coast” under an additional contract. This campaign will start in Q1 2022 with onshore preparation activities underway.
Overall, the APAC awards secure in excess of eight months vessel utilisation, while including the provision of project management, engineering and all associated fabrication (subcontracted), subsea and marine services.
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