SembMarine says termination by Marco Polo Marine breaches contract

SEMBCORP Marine (SembMarine) on early Wednesday morning said its subsidiary, PPL Shipyard, will regard the termination by Marco Polo Drilling (I) of the US$214.3 million newbuild contract as "repudiatory breach of the contract".

The response comes after Marco Polo Marine, of which Marco Polo Drilling is an indirect wholly-owned subsidiary, on Tuesday said in a filing to the Singapore Exchange that it will terminate the contract for a jack-up rig under construction at PPL Shipyard.

SembMarine on Wednesday said PPL Shipyard had not received any notice of termination of the construction contract at the time they learnt of the announcement.

The group disagrees with the allegations in Tuesday's announcement and sees it as a breach of agreement.

It will terminate the contract and claim amounts due under the contract against Marco Polo Drilling and its guarantor Marco Polo Marine.

PPL Shipyard will take the necessary steps to enforce its rights and will provide the update when required, said SembMarine.