SBM in spat with Encana over Deep Panuke woes

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 11 March 2011 01:41 GMT

SBM Offshore is in dispute with Encana over responsibility for cost increases and delays on a jack-up-based production system bound for the operator’s Deep Panuke project off Nova Scotia, Canada, writes Iain Esau.

The mobile offshore production unit is currently being commissioned at Gulf Piping’s dry dock in Abu Dhabi, with completion and load out scheduled for later this year. SBM, which saw net profit for 2010 rise 20% to $276 million, said modifications to the original design “were requested by the client” and implemented, a decision that caused “increased construction time and significant costs”.

The Monaco-based player has claimed these additional costs from Encana through change orders but said the parties “have so far not been able to reach an agreement on the level…

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