RE: Sea Rose FPSO 4 month role commencing Jan 2024 in NL Cenovus24 Sep 2023 17:59
As we are on the subject I just looked up the RNS from 31st July.
Appears we are about halfway through the expected 2-3 months until execution of a formal contract.
I starting looking more closely at where the £5m played a part as I recall some saying that it was paid back at the time of the RNS. So, if at the time it was only a "non-binding " LoI, and not a formal contract, why would they drop the £5 mil on a prospective shipyard way back then. Are drydock spaces in such short supply? From looking at the company results i know that they make some serious money and it may be small change, but would everyone on their shortlist just get a £5m retainer?
The RNS says, " As part of the overall project delivery, a sum of £5 million will be made available to the Company immediately to commence various workstreams in 2023 prior to the arrival of the vessel. Apart from the initial sum, this LoI is non-binding and will be subject to execution of a formal contract that is expected within 2-3 months."
So, my thinking was, it says "... £5 million "WILL" be made available..." and not "HAS" been made available.
To be able to"commence various workstreams in 2023" it could wait until the contract has been signed, pay the £5m to the yard and still allow said "workstreams" to happen in '23 before the arival of the vessel.
That kind of works.
But only if you ignore the bit that says," Apart from the initial sum".
That would imply that we would we get the £5m regardless of securing the contract. Just a case of when.
I've tried looking at Damens and Navantia's news feed to see if they got a similar LoI but could not see anything. They may have, but just not deemed it a newsworthy item. Looking at their revenues it may not be. :)
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