TROUBLED Norwegian floating production specialist Sevan Marine said yesterday costs had increased again on a project for E.On Ruhrgas in the UK North Sea.
The firm is struggling to refinance itself after announcing in June it had insufficient working capital to support its requirements.
As a result, work has been delayed on upgrade work on the Sevan Voyageur, contracted to E.On Ruhrgas UK E&P for its Huntingdon field at an estimated contract value of £326million for five years with extension options.
Installation of the floating production vessel had originally been expected to take place in the final quarter of this year, with first oil targeted for early 2012.
Sevan said first oil on the project was now expected to take place during the second quarter of next year.
The delays and increased procurement costs for equipment and yard services had resulted in the firm increasing its cost estimate for the project to £103-£116million compared with £97.7-£103million previously.
The cost overrun was announced yesterday as Sevan said it was delaying reporting its 2011 second-quarter results to Wednesday. It also said there would be no public presentation for quarter two.
Sevan added that its board continued to hold constructive dialogue with bondholders and others over its financial restructuring.