COSL Drilling Legal Action Threat Against Statoil

Published at 10:16AM - 07/03/16

COSL Drilling in legal action threat against Statoil, as a row heats up after the Norwegian oil major scraps two drilling rigs from its North Sea operations.

Offshore Post reported on Statoil’s actions Friday however COSL Drilling has since confirmed the news stating: “If necessary, legal actions will be taken to protect interests of the Company.”

COSL Drilling Rigs

Statoil has removed two of COSL’s rigs from drilling operations in the Norwegian Troll field, the COSLInnovator and COSLPromoter, with Statoil claiming that no further money is owed.

On the COSLInnovator contract, COSL states that Statoil has “terminated with immediate effect with no rate”, bringing an end to the contract 4 years and 8 months earlier than agreed.

In a the notice received by COSL, Statoil claims that “conditions for terminating the drilling contract … have been met”.

On the CSOLPioneer contract, COSL states that Statoil has “suspended with no rate”, leaving 5 years and 1 month on the contract left to run.

COSL adds that in the notice, Statoil claims the suspension is to enable COSL time to “implement the necessary actions to fulfil the requirements of this drilling contract.”

Statoil Statement

However, as he row ensues, Statoil released a statement clarifying their position, claiming that they are legally within their rights to take the action against COSL Drilling.

Statoil vice president for drilling, Geir Tungesvik, said: “The conditions for terminating the contract signed with COSL Offshore Management AS have in our opinion been met, and we therefore choose to use our contractual right to terminate the contract,”

“In addition Statoil has decided to stop drilling operation with the sister rig COSLPromoter when it is safe to discontinue well operations.”

“This is done in order to enable COSL to implement the necessary actions in order to fulfil the requirements of the contract.”

“The decision may have some short-term consequences for planned drilling activities, but will not have impacts on long-term production on the Troll field. The plans made by the licence for gas and fluid production from the oil zone remain firm.”

COSL Drilling Legal Action Threat Against Statoil

Neither Statoil nor COSL Drilling have elaborated as to the actual areas of the contract not to have been met.

However, a spokesman for COSL Drilling concluded: “The Company strongly disagrees with the decision of Statoil and will make active communication with Statoil to solve differences. If necessary, legal actions will be taken to protect interests of the Company.”