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Songa Offshore Hits DSME with $65.8 Mln Counterclaim

March 23, 2016

Songa Offshore has submitted its defence in the arbitrations initiated by Daewoo Shipbuilding & Marine Engineering (DSME) in 2015, regarding the first two Cat Ds rigs, Songa Equinox and Songa Endurance.

In November last year, the offshore drilling contractor received claim submissions from DSME related to the above mentioned rigs due to alleged cost overruns and additional work, what DSME alleges were inherent errors and omissions in the design documents (as often referred to as the FEED package).

However, along with its defence, Songa Offshore has now submitted counterclaims in respect of the two rigs for the aggregate amount of $65.8 million, by means of which Songa Offshore intends to recover damages caused by the default of DSME.

The Oslo-listed company considers that DSME is solely responsible for the delays to the Rigs and any attempt by DSME to recover cost overruns has no merit due to the “turn-key” nature of the construction contracts.

The semi-submersible newbuild rigs Songa Equinox and Songa Endurance were faced with BOP-related downtime while working for Statoil in Norway earlier this year.

 

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