Cosco unit delays delivery of another jack-up rig

CITING unfavourable market conditions, Cosco Corporation (Singapore) said that the delivery of another jack-up drilling rig by its Nantong unit will be delayed.

In a filing on Monday, Cosco Corp said that its unit Cosco (Nantong) Shipyard Co and KS Drilling Pte Ltd have mutually agreed to further extend, by way of a further amendment agreement, the time for delivery of the undelivered rig from April 30, 2016 to Dec 31, 2017.

This rig is one of two rigs to be delivered under a building contract between Cosco (Nantong) and KS Drilling.

"Either party remains entitled to sell the rig to a third party if the offer could recover their respective costs, or the parties could negotiate in good faith for a compromise solution to sell the rig," Cosco Corp said.

"The company is not able to ascertain the financial impact of the above amendment at this point in time as there is still no certainty as to how the rig will be eventually dealt with after the further amendment agreement," it added.

Last month, Cosco Corp said that its Dalian unit had agreed to a request from a ship owner for two jack-up rig deliveries to be delayed each by nine months. It did not name the owner.

Meanwhile, another unit Cosco (Zhoushan) Shipyard Co Ltd has delivered an oil tanker of 111,000 deadweight tonnes to its European buyer. The delivery documents were signed by and between Cosco Zhoushan and the buyer recently.