Vietgazprom Five-Well Program for the Energy Searcher

Northern Offshore, Ltd. reported today that the company received notice from Vietgazprom that they will not proceed with the fifth and final well of the five-well drilling program offshore Vietnam.  The drillship Energy Searcher, upon completion of the fourth well, was at a standby location awaiting the appropriate approval to undertake drilling operations when notice of the terminated program was received.
Under the contract with Vietgazprom, a 20-day notice of cancellation is required.  The company therefore expects to receive day rate under the contract until December 9, 2010.  The contract further requires that Vietgazprom make a demobilization payment of US$2.4 million.
The company intends to demobilize the drillship to Singapore, and will investigate the opportunity to accelerate certain inspections to coincide with the rig's idle time.  In the meantime, the company will pursue other near-term drilling programs in the region.
Source: PR Newswire (Press release)