Tuesday, May 12, 2009

Ensco gives Petrosucre termination notice over ENSCO 69

CARACAS: Ensco International Inc. (NYSE: ESV) has submitted a notice of termination to PDVSA subsidiary Petrosucre, regarding the contract for jackup ENSCO 69.

Since May 2007, ENSCO 69 has been contracted to Petrosucre. In January 2009, Ensco suspended drilling operations after Petrosucre failed to meet commitments regarding the payment of past due invoices. Petrosucre subsequently resumed ENSCO 69 drilling operations with its employees and a portion of the Venezuelan crews utilized by Ensco, under observation by Ensco's supervisory rig personnel. Petrosucre advised Ensco at the time that it was temporarily taking over operations on the rig. Since January 2009, Ensco said it has engaged in discussions and exchanges of correspondence with Petrosucre regarding each party's contractual rights and obligations, but a resolution has not been reached. In prior disclosure, Ensco noted that should a satisfactory resolution not be reached, Ensco may submit a notice of termination as outlined in the provisions of the contract giving Ensco a right to terminate in the event of non-payment.
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