Norwegian offshore services provider Solstad Offshore says continuing weak market conditions will force the company to lay-up an additional 10 vessels, leading to the elimination of approximately 300 jobs by the end of 2015.
The lay-ups were revealed Tuesday in the company’s 2nd quarter and 1st half results.
Solstad says that the lay-ups, which will mainly impact the company’s platform supply vessels (PSVs) and anchor handling tugs (AHTS), are driven by the weak spot market in the North Sea and worldwide as the result of the low oil prices.
At the end of Q2, Solstad already had 3 vessels in lay-up, including 2 PSVs and 1 smaller AHTS.
“The spot market in the North Sea for PSV’s and AHTS’s is characterized by overcapacity and approximately 50 vessels of these types is currently in lay-up,” Solstad said in its report. “In the CSV-segment, the activity has been higher, in both the North Sea and worldwide. The general market outlooks are still weak and have not changed during the summer. In addition to low oil price, the uncertainty in Brazil and the sanctions between EU/USA and Russia have not changed to the better for the market. The company expect that the market will continue to be weak in the remaining part of the year and also in 2016.”
Overall the company’s fleet consisted of 46 wholly owned or partly owned vessels consisting of 20 construction service vessels (CSVs), 17 AHTS’ and 9 PSVs at the end of Q2. The company also has one vessel under construction.