Offshore rig builder Lamprell has delivered the “Ensco 140” LeTourneau-designed, Super 116E (Enhanced) Class jack-up drilling rig to Ensco.
The UAE-based yard on July 26, 2016 said the rig’s delivery would be delayed, resulting in potential exposure to remedial costs and liquidated damages. On, Sunday, August 28, Lamprell informed that it had signed an agreement with the client to settle all claims arising from the late delivery of the rig.
The settlement agreement includes a deduction of $25 million from the final milestone payment in respect of late delivery. As part of the settlement, Lamprell will also provide services for the “Ensco 140 and 141” rigs, including temporary storage and grant an extended warranty for the jacking equipment supplied by the original equipment manufacturer, Cameron LeTourneau.
As a result of the settlement agreement, Lamprell’s expected 2016 revenue will be reduced by $25 million and the company anticipates a reduction of around $35 million on its expected 2016 profit. The rig builder said the late delivery of the “Ensco 140” rig was caused by failures in the jacking equipment that Cameron supplied.
“Lamprell has successfully implemented a solution for this issue on the “Ensco 140″ rig and the Group expects to deliver the other six projects as planned. Lamprell’s Board is fully committed to recovering the remedial costs arising from the technical defects in the jacking equipment from Cameron as well as seeking compensation from Cameron,” Lamprell said.