A Review of the Nigerian Energy Industry

Hercules nets $50m jack-up payout

Oil Rig25 December 2013, News Wires – Hercules Offshore is to book a $31 million gain in the fourth quarter after agreeing on an insurance payout over a rig that was destroyed in a Gulf of Mexico blowout earlier this year.

The Houston-based rig and vessel owner will, however, also book an impairment charge after completing the sale of another unit.

Hercules reached an agreement with insurance underwriters on Friday that will lead to it receiving $50 million for the Hercules 265 being declared a constructive total loss. The unit was badly damaged by the blowout and fire on the South Timbalier Block 220 in July.

The parties are still negotiating any possible insurance payouts concerning the ensuing salvage operation.

The payout revealed on Monday will lead to a $31 million insurance gain in Hercules’ fourth-quarter result.

The company also completed the sale of the Hercules 170 jack-up for $8.7 million. This will, however, result in a $12 million impairment in the fourth quarter.




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