OSV market rates to remain low in 2018, Siem says

Norwegian shipping company Siem Offshore expects rates in the North Sea offshore support vessel market to remain volatile and generally low in 2018.

In its fourth quarter 2017 report on Thursday, Siem Offshore said that the North Sea OSV market continued to be volatile during the fourth quarter with small peaks in day rates caused mainly by the weather.

According to the company, several vessels returned to the North Sea after the seasonal campaigns further exacerbating the excess capacity situation during these winter months.

“Although we expect an uptick in the activity level during the summer period, we believe that the market rates will remain volatile and generally low in 2018,” Siem said.

The shipping company also added that, despite indications of increased activity, the timing of a significant sustainable improvement in utilization and rates is uncertain and this situation will continue to put financial pressure on owners and lenders.

When it comes to its performance in the last quarter of 2017, Siem’s operating loss was $49.7 million for the fourth quarter of 2017 compared to a $86 million loss in 4Q 2016 after depreciation and amortization expenses of $30.6 million and after impairment of certain vessels of $51.1 million.

Net loss attributable to shareholders in 4Q 2017 totaled $52.2 million compared to $129.6 million loss in the same period of 2016.

The company’s operating revenues fell to $88.8 million from $132.6 million in the prior-year quarter.

The reduction in revenues from 4Q 2016 is mainly due to lower revenues from project in Siem Offshore Contractors.

Siem Offshore’s fleet at the end of 2017 consisted of 43 vessels, compared to 46 vessels at the end of 2016. Five vessels were in laid up at the end of the fourth quarter.

Offshore Energy Today Staff

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