Oilfield engineering service group Aker Solutions said yesterday issues at its Brazilian manufacturing plant and lack of oil industry resources in the country had contributed towards expected costs of £44.5million-£55.6million.
The firm has been battling delays and quality issues on subsea production systems it is producing for Petrobras.
In its second quarter results, announced in August, the firm said “quality costs relating to execution issues” in Brazil had amounted to £14.5million.
Yesterday, it said damages were now expected to be in the range of £44.5million-£55.6million.
The firm said it has put in a new management team for its subsea business area in Brazil and sent in a “multi-disciplinary task force” to address issues in the country.
Øyvind Eriksen, executive chairman of Aker Solutions, said: “Our performance is hampered by high activity in Brazil. Suppliers to the oil industry in the region are facing lack of resources.
“But parts of the reason for our delays are also very specific to Aker Solutions and our manufacturing site in Curitiba.”
Aker Solution added that it was continuing to expand in Brazil, including investments at a service base for drilling and subsea systems and its engineering and process systems businesses in Rio de Janeiro.