Havyard Buyer Bails

Image credit: Havyard Design As/GunnarF AS

The unidentified buyer of a new-design subsea vessel at the Norwegian ship technology company Havyard has cancelled the shipbuilding contract amid horrible conditions in the market for offshore vessels.

Havyard Ship Technology AS entered into the NOK 700 million contract with the international buyer in July 2015 calling for the design and construction of a Havyard 858 L WE subsea vessel to be delivered in the second quarter of 2017.

By October, Havyard said that due to the difficult market situation for offshore vessels internationally it agreed to postpone delivery of the vessel until the second quarter of 2018. The revised contract stipulated that the buyer could cancel the contract by March 2016, provided the buyer pays Havyard Ship Technology an undisclosed fee.

“In light of the continuing challenges in the offshore market internationally, Havyard Ship Technology AS and the buyer have today signed an agreement for cancellation of the shipbuilding contract,” Havyard Group said in a statement announcing the cancellation. “The agreement involves payment of a compensation to Havyard.”

The company added that the cancellation will have no affect for liquidity and profits in Havyard Ship Technology AS for the financial year 2016, but will lead to a lower activity and a smaller margin loss in Havyard Design & Solutions AS for 2016.

The Havyard 858 L WE is developed by Havyard Design & Solutions in Norway. The DP3 vessel was to perform IMR (Inspection Maintenance and Repair) and light construction work on subsea installations. The vessel would have measured 121 meters long by 24 meters wide, and come equipped with two cranes (250 and 30 tonnes), a moon pool, helideck, 1,500 square meters of deck space, and accommodations for 140 people. 

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