Malaysia-based offshore marine company Nam Cheong Limited has received a notice of termination for the sale of one accommodation work barge from Petra Offshore Ltd (POL), a subsidiary of Bursa-listed Perdana Petroleum Berhad.
“The group’s position is that the purported notice of termination/cancellation is not valid and is tantamount to a repudiation of the contract by POL, pursuant to which the group is entitled to compensation from POL,” Nam Cheong said.
The company added that it plans to “fully enforce its rights against POL and, if necessary, seek legal redress” .
Nam Cheong also said that the contract termination is expected to affect the company’s earnings in 2016, however, it is not sure to which extent as it will depend “on the outcome of the company’s legal remedies against POL” .
Nam Cheong and POL signed the contract for the sale of two accommodation work barges, valued at USD 84 million, in June 2014.
The 123-meter-long vessels were under construction at Chinese yards and were scheduled for delivery during 2016.
The contract also included an option for two additional vessels.