Eni Cancels Barents Sea Vessel

Published at 08:38AM - 25/07/16

Viking Supply Ships (VSS) announced it has received an early termination notice for a vessel contracted to work in the Barents Sea.

The Ice-class 1A AHTS “Njord Viking “ had been contracted to Eni Norge and was part of the extended towing-preparedness in the area, on behalf of the Norwegian Coastal Administration.

“VSS will further offset this loss by marketing the vessel in the North Sea spot market, while also searching for alternative contracts for the vessel,” VSS said in a statement.

Eni Cancels Barents Sea Vessel

According to the Swedish offshore services company, the vessel was according to the contract with Eni Norge until the end of 2016, with optional periods of two semesters thereafter.

Under the agreement, VSS will be entitled to a termination fee of approximately US$13.300 per day, which represents a loss of income of US$3.3 million (£2.51 million) in 2016 during the remaining firm period of the contract.

Nord Viking With ENI Goliat FPSO
Nord Viking With ENI Goliat FPSO

Eni Norge had extended the deal for the Njord Viking in July last year, although at a reduced day rate.

The initial firm period was expected to end in July 29, 2015.

Viking Supply Ships Fights Crisis

VSS has been trying to find a long-term financing solution for a restructuring as it has been deeply affected by the current crisis in the oil and gas sector.

Over the first quarter of 2015, the company signed a new contract for its Brage Viking, but had to close down its Aberdeen office to remain competitive and reduce costs.

Earlier this year, VSS also sold the small bulk vessel TransForte.

Over the second quarter, VSS signed a new contract for Vidar Viking and renewed the seven-year contract for the state-owned ice-breaker fleet with the Swedish Maritime Administration.

In the last quarter of 2015, VSS saw its contract for Njord Viking extended and initiated a programme to reduce annual operational costs.

As well as this, it sold TransAtlantic Container AB and posted a negative impact on its earnings and financial position amid challenging market conditions.