Pacific Drilling swings to loss

Pacific Khamsin; Image; Pacific Drilling
Pacific Khamsin; Image; Pacific Drilling

Offshore ultra-deepwater drilling company, Pacific Drilling, on Monday swung to a net loss for fourth-quarter 2015 of $13.6 million, compared to net income of $68 million in the corresponding period of 2014. 

Pacific Drilling’s contract drilling revenue for fourth quarter of 2015 was $267.6 million, which included $20.4 million of deferred revenue amortization, compared to contract drilling revenue of $319.7 million in the same period of 2014.

According to the offshore driller, revenue benefited from an overall improved revenue efficiency performance during the quarter, offset by the Pacific Khamsin completing its drilling operations on December 17, 2015.

To remind, the company’s ultra-deepwater drillship Pacific Khamsin was left without a contract after completing the one with Chevron in Nigeria bringing the number of Pacific Drilling’s drillships without a contract to three, in a fleet of seven.

On October 29, 2015, Pacific Drilling exercised its right to rescind the construction contract for the Pacific Zonda due to, as the driller said, the shipyard’s failure to timely deliver the vessel in accordance with the specifications of the construction contract, and in connection with the rescission, the 2014 revolving credit facility was terminated on Oct. 30, 2015. Pacific Zonda would have been the company’s eighth drillship.

The company’s fourth-quarter and full-year 2015 net income included a non-recurring loss of $40.2 million from the construction contract rescission and a $6 million write-off of deferred financing charges from termination of the 2014 revolving credit facility.

CEO Chris Beckett said, “Going forward, our efforts will continue to be focused on providing our clients with the highest quality service and safe and efficient operations, in combination with innovative technical and creative commercial solutions, which will continue to be differentiating factors for us. With the shipyard’s failure to deliver our final drillship by the required date, we have completed our current newbuild program and have no further new construction expenditures.”

Offshore Energy Today Staff

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