Sevan Drilling and Cosco have agreed to amend the termination rights of the construction contract for the Sevan Developer drilling rig and defer the delivery date.
Delivery is deferred for 12 months with mutually agreed options, exercisable at 6 month intervals, to extend the delivery date for up to a total of 36 months from 15 October 2014. The agreement will terminate at the end of each deferral period, unless the option to extend is mutually agreed by both parties. If termination should occur, Sevan is entitled to a refund of its instalments less any agreed costs.
Cosco will complete construction and maintain the rig at the shipyard in Qidong.
Sevan will continue to market the rig as part of its fleet and delivery will take place only after a drilling contract is in place that is sufficient for secured financing to be obtained. Payment of the construction liability and other related costs will be deferred until delivery and the service agreement is expected be concluded within Q4 2014.
“Sevan is very pleased to have reached this agreement and looks forward to a continued strong relationship with our strategic partner Cosco,” the company has said in a statement.