Date: 23 January 2009
Ability Drilling and Geoenergie Bayern cancel agreement
Ability Drilling and Geoenergie Bayern have agreed to terminate its
agreement. The agreement included a drilling contract for land Rig
no. 2, originally scheduled to start operations in Germany in Q4
2008.
According to CEO Hans Petter Eikeland there are several reasons for
the termination of the agreement: "Delivery delays triggered the
customer's decision regarding land rig no. 2, but the overall picture
with lower energy prices worldwide, which is related to the current
situation in the world economy, is also an important factor. We could
not agree on the terms for a future partnership and decided to
terminate the agreement."
Mr. Eikeland still believes geothermal drilling is an interesting
market for Ability Drilling, but expects that it will take some time
before the availability of projects improves. "Our rigs are very well
suited for this type of projects, and we are in contact with several
possible future customers. However, we believe that both credit
issues and energy prices will slow down the market for a while."
The CEO confirms that Ability Drilling is negotiating new contracts
for the rigs available for the market. "Negotiations are progressing
well for all rigs, but the termination of contracts with Porosity and
Geoenergie negatively impacts our business in the current quarter as
we cannot employ the rigs over the night. Consequently, we have
reduced manning and cost to adapt to the current situation while we
are finalising new contracts. We expect this to be solved in Q1."
For further information, please contact:
CEO Hans Petter Eikeland, phone +47 56 32 43 43, or +47 93 20 81 77
CFO Kenneth Tunes, tlf. 56 32 43 43, eller 91 54 49 01
About Ability Drilling ASA: Ability Drilling aims to become the
preferred operator and provider of Rack & Pinion (R&P) rigs in its
defined core markets, by combining fourth generation drilling
technology with outstanding drilling experience from offshore North
Sea exploration and production activities.
The Company currently targets onshore oil operations in the MENA
(Middle East North Africa) market, the geothermal market in Europe,
as well as the market for drilling of LNG reservoirs. Both the land
rig market in MENA and the geothermal segment in Europe are markets
with strong growth and significant potential, while the market for
drilling of LNG reservoirs is an emerging growth segment. Ability
Drilling targets extension of the geographical footprint within all
current focus areas.
Ability Drilling has so far ordered 11 rigs, of which 9 land rigs,
one 150 T workover rig and one 150 T Ultra Light Drilling Rig. In
addition, the company has options with construction partner TTS Sense
for 33 additional land rigs and 40 additional workover rigs.
Ability Drilling is listed on Oslo Axess, with ticker ADRL.
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