Ten Out of 14 Prosafe Rigs to Be Out of Operation
Accommodation-rig operator Prosafe said on Monday another two of its rigs were expected to be taken out of the Mexican market due to low oil prices and spending cuts by state-owned oil firm Pemex.
The two rigs, called Safe Lancia and Safe Regency, will be taken out of operation in mid-March. Safe Lancia was originally contracted until the end of 2016 while Safe Regency was contracted until the end of 2017.
The move means that all five Prosafe rigs working off Mexico, and ten out of the company's 14 rigs worldwide, will be idle. Prosafe provides accommodation rigs to oil companies working offshore.
"Pemex has been cutting spending in order to adjust their budget to an oil price of $25 per barrel. Consequently, Prosafe's Mexican client Cotemar Group has been directly impacted," Prosafe said in a statement.
In addition, Prosafe will have one newbuild rig delivered in the third quarter 2016, which will begin a three-year contract in the first quarter of 2017.
Prosafe shares were down 20.8 percent to 9.42 crowns at 1450 GMT, lagging an Oslo benchmark index down 0.6 percent.
Prosafe was not available for further comment when contacted by Reuters.
(Reporting by Ole Petter Skonnord)
