17.11.2015 08:49:55 CET
As previously announced on July 15, 2015, Songa Offshore received notices of arbitration from DSME in respect of the construction contracts for the Cat D rigs.
On November 16, 2015, Songa Offshore received claim submissions from DSME related to Songa Equinox, the first Cat D rig, in which DSME asserts a claim of USD 179 million, along with a request for repayment of liquidated damages in a total amount of USD 22 million. The claim that is asserted relates to alleged cost overruns and additional work in relation to Songa Equinox rig due to what DSME alleges were inherent errors and omissions in the design documents (as often referred to as the FEED package).
Songa Offshore has performed an initial review of the claim and does not consider that there is any substance to the claims asserted by DSME. The Company is confident of its position, since it is of the view that DSME is responsible for the delays and any attempt to recover cost overruns is of no merit due to the "turn-key" nature of the construction contract. Songa Offshore has obtained legal opinions from highly reputable law firms in the UK and Norway and from a Queen's Counsel all of which confirm the Company's position.
Further details will be provided as and when appropriate.
17 November 2015
Limassol, Cyprus
For further information, please contact:
Bjørnar Iversen, CEO (+357 996 49 152)
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)