LONDON (Alliance News) - Ithaca Energy Inc shares dropped on Wednesday morning after the company said it would book USD10 million in costs from a delay to the deployment of the floating production facility modification programme at the Greater Stella Area production hub in the North Sea.
Shares in Ithaca were down 24% to 50.20 pence, one of the worst performers in the AIM All-Share, after the company said the work being undertaken to modify the floating production facility by FTSE 250-listed Petrofac Ltd would not be completed in time to achieve sail-away for the vessel in the second quarter of this year.
Petrofac shares were up 3.1% at 840.50p early Wednesday, having reported 2014 earnings.
Ithaca expects sail-away for the facility to take place in the first quarter of 2016, resulting in the first hydrocarbon production at the prospect in the second quarter of 2016.
The delay to the start-up of the Greater Stella Area is estimated to result in incremental costs for Ithaca of around USD10 million, primarily related to project management costs for the overall development.
"It is disappointing to incur a further delay in completion of the FPF-1 modifications programme. While the drilling and subsea installation aspects of the Greater Stella Area development have progressed well, completion of the FPF-1 programme has proved difficult," said Ithaca Chief Executive Officer Les Thomas.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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