Oil firms must pay more for service vessels -Norway ship owners

Awilco Drilling

05/04/2018 14:31

OSLO, April 5 (Reuters) - Oil companies should be prepared
to pay higher rates for renting offshore service vessels, in
order to secure the long-term survival of a key part of the
industry's supply chain, the Norwegian Shipowners' Association
said on Thursday.
    Energy firms sharply curtailed investments in the wake of
the 2014 oil price crash, idling many service vessels and
driving down market rates to unsustainable levels, Chief
Executive Harald Solberg of the Norwegian lobby group said.
    At the peak last year, some 183 offshore vessels and rigs,
corresponding to almost one third of the Norwegian fleet, were
mothballed, he said, adding that by February the number had
dropped to 162 units.
    And although most Norwegian ship owners see a brighter
future, the offshore vessel industry's outlook is more subdued,
even though lay-ups are likely to fall to around 110 vessels and
rigs this year, a survey of the association's members showed.
    "There isn't sustainable profitability in offshore and rig.
Rates have to improve to secure this business. It's not only the
oil companies that should earn money, we need a better balance,"
Solberg said.
    While revenue in the offshore services business is expected
to further decline in 2018, turnover in Norway's combined
maritime fleet is expected to increase by some three percent to
219 billion Norwegian crowns ($28 billion) after falling in each
of the last three years.

($1 = 7.8222 Norwegian crowns)

 (Reporting by Ole Petter Skonnord, editing by Terje Solsvik)
 ((olepetter.skonnord@thomsonreuters.com; 0047 23 31 65 97;))