COLUMN | Calm down: Nigeria goes to the polls as Heroic Idun crew face delays; asset flippers are back, literally; PX121s change hands at higher prices; Telford and Smit Lamnalco sold; Bourbon and Horizon tie up [Offshore Accounts]

Nigerian singer-songwriter Rema is currently soaring high in the charts with his smash song Calm Down (here). Since last weekend was Nigerian presidential election weekend, that seems an appropriate tune. Upstart Peter Obi of the Labour Party battles septuagenarian Bola Tinubu, a former governor of Lagos representing the ruling All Progressives Congress, and Atiku Abubakar, who was previously vice-president from 1999 to 2007 and is now making his sixth run for the presidency at the age of 76.

By the time you read this piece, maybe the results will be known, and maybe the race will go to a run-off vote next month if the leading candidate does not receive a plurality of the votes, and over 25 per cent of the vote in at least 24 of the country’s 36 states. At the same time, all 109 seats in the Senate of Nigeria will also be up for election, and all 360 seats in the House of Representatives are also up for grabs at the polls. Let’s hope the streets of Lagos remain calm as the results are announced and that the new president is honest and competent.

Nigeria’s currency crisis caps Buhari’s failing presidency

Nigerian President Muhammadu Buhari addresses the crowd during a campaign rally held days before the country’s 2023 presidential elections. (Photo: President Muhammadu Buhari’s official Facebook page)

The run up to the election was chaotic, as outgoing and chronically incompetent President Muhammadu Buhari botched the release of new naira bank notes. The Nigerian central bank said in October last year that the NGN200, NGN500 and NGN1,000 notes would be replaced with new designs that it claimed would feature higher levels of security against forgery.

The old notes were due to be taken out of circulation on January 31, but the government messed up the release of the new ones. As crowds gathered at ATMs, queues formed at banks and supermarkets restricted the change given to customers due to the unavailability of the new notes. The government was finally forced to backtrack on the phase-out. First the deadline for taking the old notes out of legal circulation was shifted to February 11, and now it has been deferred until April by court decree.

In an economy where cash remains king, the failure to print and distribute enough new notes led to fights breaking out, people unable to access their salaries, and some bank branches simply closing. Buhari tried to blame the commercial banks for the problems. If you wanted another symbol of his failure as a president, this was it. The sooner this lame duck president is replaced by a leader who can actually implement reform in Africa’s most populous nation, and in what should be Africa’s largest oil producer, the better.

Heroic Idun crew face further delay, longer injustice

Some of the crew of the crude oil tanker Heroic Idun shortly after they were detained by local authorities in Equatorial Guinea in August 2022 (Photo: All India Seafarers Union)

The 26 crew of the very large crude carrier (VLCC) Heroic Idun face further judicial delays in Nigeria after their trial on absurd and trumped up charges was adjourned on Monday, February 20, and the hearing postponed until March 23 (We covered the injustice of the crew’s case and the saga of absolute ineptitude from the Nigerian Navy here.).

All crewmembers have denied charges of attempting to export oil without a licence and have denied an offence under the Nigerian Suppression of Piracy Act of pretending to be attacked by pirates. In the meantime, they are held on bail on board the vessel at anchor off Bonny.

It defies any sense of natural justice that the crew and junior officers should be charged at all for these events. Could the Nigerian Navy please explain how the cook could be attempting to lift crude from an offshore terminal without the correct paperwork? Indeed, the charges against the Indian master and Polish chief engineer are equally spurious given the circumstances.

We reiterate our headline from last month: Nigeria should fire its corrupt naval leadership and Abuja should free the detained crew now. The change of president, of the senate, and of the house of representatives, along with gubernatorial elections for state governors in 31 out of 36 Nigerian states in March, means that the next month will see a chance for a complete reset of the country’s politics and the possibility of a clean sweep of the legislature.

Let’s hope that the new president can set the VLCC crew free soonest and reform the hopelessly rotten Nigerian Navy. The crew of Heroic Idun – or of any ship, for that matter – should not be used as pawns in political games.

Calm down, asset flippers!

Normand Flipper (Photo:

Now is the long winter of offshore discontent, made glorious summer by this high oil price, as Shakespeare once wrote. And all the clouds that lour’d upon the OSV business are in the deep bosom of the ocean buried, including at Solstad, which announced the ultimate asset flip – the sale of its twenty year old platform supply vessel (PSV) Normand Flipper, which was quickly renamed HM Flipper on February 10, 2023, and transferred from the Norwegian to Bahamas flag in Aberdeen.

The HM-preface gives away that the UT-745E design PSV with its 1,000-square-metre clear deck and 4,276 DWT capacity is now controlled by Harald Moraeus-Hanssen, former boss of Fearnley Securities (whose old company acted as sole arranger for the project), through his company Uthalden Maritime, and his partners at Vestland Offshore.

This is not the only offshore asset Mr Moraeus-Hanssen and Uthalden Maritime have acquired an interest in over the last year. In addition to owning HM Flipper, he also owns a stake in Skandi Akura, a 2012-built DP2 PSV of 4,600 DWT with 1,000 square metres of clear deck space. The vessel was acquired in 2022 for US$12.5 million, according to the trade press. That asset has probably doubled in value in the time he has owned it.

Chequered history of SSV Catarina

SSV Catarina (Photo: Marino)

Last year, Mr Moraeus-Hanssen also purchased the sixth-generation DP2 semi-submersible drilling rig SSV Catarina (which was built in 2012), along with co-investor Oystein Stray Spetalen (of S. D. Standard ETC fame, the former Standard Drilling). The unit has had a chequered operational career being built at Daewoo in Korea for PetroServ Marine in Brazil, and working first in Angola for scandal-ridden Cobalt Energy in 2013, before returning to Asia work for ENI in Indonesia through accident-prone Singaporean contractor KS Drilling (here and here) in 2019.

The ENI contract was suspended and then terminated when Covid struck in 2020, and KS Drilling was placed in administration and then into liquidation in 2021, with its jackup rig Java Star being sold to Chinese interests for less than US$10 million in 2021, and its chairman Kris Wiluan fined over US$300,000 in Singapore for manipulating the company’s share price. This market rigging case saw the Singapore authorities issue a stern warning, in lieu of prosecution, against Mr Wiluan’s family office manager for intentionally aiding him with the market fixing. This is not surprising, because white collar criminals who collude in rigging public markets or who authorise hundreds of millions of bribes at Keppel should only get a slap across the wrist in Singapore.

But I digress. The rig is still sitting idle offshore Balikpapan in Indonesia, but has already doubled in value since Mr Moraeus-Hanssen bought it.

This is asset speculation at its finest. If only there was an Olympic medal for such activities, Norway would be on the podium with gold. To cap it all, Mr Moraeus-Hanssen, together with countrymen Gunnar Hvammen and Petter Stordalen (art collector, philanthropist and the owner of downmarket hospitality chain Nordic Choice Hotels), has also bought abandoned seventh-generation drillship West Dorado, which was originally ordered Seadrill at Samsung Heavy Industries in Korean, but was cancelled in 2018 when Seadrill went bust.

The rig will apparently be completed and delivered this year as Dorado, and the speculators paid US$200 million for it, according to Esgian last month. Mr Stordalen once chained himself to a nuclear power station in protest against nuclear waste, according to his Wikipedia page, but apparently profiting from carbon-intensive oil and gas drilling is fine by him.

Deep Value Driller goes to Saipem

Mr Moraeus-Hanssen’s Uthalden is the largest single shareholder in Deep Value Driller, holding 8.8 per cent in the owner of the abandoned seventh generation drillship Deep Value Driller (the former Bolette Dolphin built in 2014), followed by Goldman Sachs with 6.6 per cent of the shares on the register.

Last week, this investment came good. Having bought the rig for nine cents on the dollar, US$65 million, in 2021 after the collapse of its owner Fred. Olsen Energy in 2019, Deep Value Driller had been holding the rig cold-stacked waiting for a buyer or a charterer.

On Friday, the company announced it has secured a three year firm bareboat charter of the unit to Saipem, with options to extend the charter by up to one year.

Deep Value Driller said the contract amounted to approximately US$160 million of firm revenue, being around US$146,000 per day, excluding the rate payable for any optional extensions.

The company said that the drillship should enter service with the Italian driller during the summer, and that it had secured a US$75 million loan to fund the reactivation activities at an interest rate of 9.75 per cent, secured against the rig.

To be honest, we had thought that Deep Value Driller would flip the unit for a one-off profit. I guess we are too early in the cycle for that…

Deals back on the table: Fugro bags Britoil duo

Topaz Energy (Photo: Andry)

After years of bankruptcy and misery, deals are suddenly back on the table. Fugro announced last week that it was buying Britoil’s two Ulstein design DP2 PX121 PSVs Topaz Endurance and Topaz Energy, which were both built at Britoil’s own shipyard with appalling timing in 2015. Fugro said that it would repurpose them as geotechnical vessels. The units had been bare-boated out by Britoil to P&O Maritine Logistics in West Africa, and the expiration of the charter gave Fugro the chance to snatch them.

The company’s press release was a direct slap in the face to its rival Ocean Infinity, which has bet the farm on an armada of 85-metre-long uncrewed vessels being built at Vard Vung Tau in Vietnam and modifying for apparently “lean crewed” operations as an entry point for future remotely controlled, uncrewed, autonomous operations, at Vard in in Norway (our review here).

“For Fugro’s market leading position, geotechnical vessels are key strategic assets,” Fugro wrote. “For the foreseeable future, marine geotechnical services will not be executed by uncrewed platforms. Fugro maintains its uncrewed vessel strategy and net zero emissions roadmap…

“With the purchase of these strategic assets, Fugro will maintain a balanced vessel portfolio while keeping flexibility towards the future. The purchase of these core strategic assets also supports Fugro’s net zero 2035 roadmap, as the vessels are significantly more energy-efficient than Fugro’s current fleet and offer options for hybrid conversions and/or alternative marine fuels in the future. Fugro continues to invest in remote and digital solutions and will further grow its fleet of uncrewed surface vessels as part of its net zero 2035 roadmap.”

Ouch! Basically, the company is saying that these Britoil vessels are cheaper, more effective, and operationally proven than Ocean Infinity’s offerings, even at the reported US$25 million unit purchase price, and that Fugro will operate both its smaller uncrewed survey units and these larger diesel-electric units in parallel.

Fugro is supposed to be unveiling a methanol conversion of the engine of the survey vessel Fugro Pioneer to run on emission-free green methanol this year, under a €24 million (US$25.3 million) Dutch government subsidy. It has been remarkably silent about that of late (our coverage here).

The battle for leadership in the subsea robotic survey market just got tougher, especially with Reach Subsea announcing a strategic partnership for co-ownership of the ROV support vessel Edda Sun, in a new joint venture with Eidesvik Offshore. The joint venture is 50.1 per cent owned by Eidesvik and and 49.9 per cent owned by Reach Subsea, which was formerly partnered with MMT of Sweden until that survey company was untimely bought by Ocean Infinity in 2021.

This is a heavily contested space and our money is on Fugro and Ireland’s XOcean, which I think Fugro will ultimately buy.

Deals back on the table: Wagenborg takes another PX121

Kasteelborg (Photo: Royal Wagenborg)

Fugro is not the only Dutch player moving to convert PX 121 PSVs for more sophisticated work. This Ulstein design has proven a remarkably successful, fuel efficient, multi-role PSV.

Earlier this month, Wagenborg Offshore announced it would convert another PX121 for service as its fifth walk-to-work multipurpose offshore vessel at the Royal Niestern Sander shipyard in Delfzijl in the Netherlands. Wagenborg bought the unit, believed to be Hermit Thunder, from Borealis Maritime, which had purchased a fleet of them from the banks after the implosion of the Emanuele Lauro-controlled Hermitage Offshore Services.

A year ago, Borealis acquired the remaining six PSVs owned by DNB and SEB for around US$15 million each, and it is now selling one for US$25 million. It’s a great flip for Borealis owner Christoph Toepfer, but also a great deal for Wagenborg, as nobody is currently building new, high-end PSVs. And even if they wanted to build one, a new vessel would probably cost US$45 million and would take two or three years to deliver.

The Wagenborg upgrades to the PX121 include an additional accommodation module to house 20 more personnel and the installation of an active heave-compensated crane. Wagenborg said that the ship will have an emergency response and rescue vessel class C notation, allowing it to also undertake emergency response and rescue duties.

This looks like a similar conversion to that of the PX121 Blue Queen to Kasteelborg, Wagenborg’s second walk-to-work vessel in 2017 (here), and to its fourth walk-to-work vessel, Koenigsborg. In early 2022, PX121 Hermit Viking was converted as Koenigsborg, again at Royal Niestern Sander shipyard (here), by building a dedicated accommodation module, installing a motion compensated gangway, and converting the vessel in accordance with SPS-60 class.

As Vroon flounders (here), it is good to see Fugro and Wagenborg going from strength to strength, and Britoil and Borealis profiting from their patient holding of offshore assets into a rising market.

More deals in Canada…

Calm down; there’s three more deals to report.

This month has also seen Bourbon announce that it is pooling its North Sea fleet with Horizon Maritime of Canada in a new joint venture, Bourbon Horizon, which will be focused on both the North Sea and  Canadian offshore markets.  Incorporated in Norway, the new company will have offices in Fosnavåg in Norway and St. John’s in Newfoundland and Labrador, Canada. The company’s base fleet consists of five former Bourbon PSV’s, a large AHTS with WROV (Horizon Arctic), and an MPSV currently configured for subsea and trenching services (Horizon Enabler).

Horizon Arctic is the former Bourbon Arctic, which was built in 2016 in Norway and sold to Horizon as part of Bourbon’s fire sale in 2019, pre-bankruptcy. The ship boasts a bollard pull of 307 tonnes in “boost mode” and 193 tonnes in diesel-electric mode. Horizon Enabler is the former Tidewater Enabler, which was built in 2009 and features a 100-tonne capacity active heave compensated subsea crane for service in up to 2,000 metres of water, berths for 82 passengers, and clear deck space of more than 900 square metres. Horizon Enabler is currently working in the North Sea for Helix Energy Solutions.

More deals in Spain…

Then, Boluda also purchased Smit Lamnalco, the terminal towage specialist, which was formerly 50 per cent owned by dredging and construction powerhouse the Boskalis Group and 50 per cent by the Rezayat Group of Al-Khobar, Saudi Arabia. Smit Lamnalco employs more than 1,600 people and owns 111 vessels, but many of these are small line handlers. Smit Lamnalco’s speciality has been LNG, offshore tanker terminals, and dry bulk against long-term contracts.

“Boluda is a company that has never stopped growing and transforming itself,” Vicente Boluda Fos, Chairman of Boluda Corporación Marítima, said in the press release. “This new stage is the logical consequence of previous evolutions that, over the last few years, have made us number one in port logistics services and in the towage sector. The industry is at a turning point, impacted by the climate emergency and geopolitical tensions. Shipping is at the centre of these issues, facing challenges like never before. As a global leader, we are aware of our responsibilities and we will continue to commit to sustainable development, which benefits society and its development.”

No price was put on the transaction and the recent decision to take Boskalis private and de-list its shares from the public markets on November 9 last year means we have no way of knowing. Both Boluda and the Rezayat Group are private so there is no public disclosure anywhere we can see.

And in UAE…

Telford 25 (Photo: Diving Services Dry Ship Repairs)

Finally, Telford Offshore of the UAE, along with its fleet of five high-end construction vessels, has been bought by Merced Capital of the USA (here). To recap, these are: Telford 25, which is fitted with an 800-tonne crane, rigid pipelay capable, 1,500 square metres of deck space and 379 berths; Telford 28, which has a 270-tonne crane, 1,500 square metres of deck space and 462 berths; Telford 30, with a 270-tonne crane, rigid pipelay capable, 300 square metres of deck space and 480 berths; Telford 31, with a 400-tonne crane, 1,300 square metres of deck space and 477 berths; and Telford 34, with an 800-tonne crane, rigid pipelay system, 1,350 square metres of deck space and 339 berths.

The company was subject to an acrimonious legal battle with its former owners Sea Trucks of Nigeria. The matter was settled in 2019, as we reported, which followed from Sea Trucks defaulting on a US$575 million senior secured bond. Then, in 2021, Telford 31 was reported briefly detained in Nigeria.

Again, there is no value published about the deal, because the whole arrangement is veiled in the privacy of a private restructuring and a private equity deal. Again, there appears to be a debt-for-equity element, as Merced said that after the transaction the company would have zero debt, but that it had been the primary funder of the company up until the transaction this month.

As part of the deal, Merced bought in a new CEO for Telford, Robert Duncan, who was previously CEO of liftboat operator Seafox International.

We love the transparency and disclosure that public listings provide. These private deals are hard to assess and difficult to analyse.

Conclusion: Calm down

As the container industry disappears into another ten-year funk, and massive Capesize dry bulk carriers fix for less than the price of a 120-tonne bollard pull anchor handler in Malaysia, offshore is back. In fact, it’s “sweeter than Fanta,” as Rema would put it.

The industry is not yet as sexy as Selena Gomez, who joined Rema on the vocals, so don’t let a few months of high rates go to your head. This is a cyclical business, in case you forgot.

Calm down!

Background reading

For obvious libel reasons, we didn’t choose PinkPantheress and Ice Spice’s viral hit Boy’s a liar as our theme song this week. However, as you listen to the number two hit in the UK chart here, does anyone in the offshore/subsea mining/survey space come to your mind? Interesting…

Should you find some new Nigerian bank notes, note that NGN1,000 is equivalent to US$2.17. We’re not talking about the roll-out of a new one hundred dollar bill here, but in Nigeria, these notes are a day’s wages for many people.

The indefatigable Maria Dixon has been running daily updates on the Heroic Idun crew on Linkedin.

See our earlier Fugro versus Ocean Infinity coverage from 2021.

Telford Offshore is a company with a long and fraught history, a flavour of which is here and here, and the lengthier and more spicy version of the rise and fall of Jacques Roomans and Sea Trucks Group is in The Cablehere. The author of the piece, Shina Loremikan, is coordinator of the Campaign Against Impunity. Heaven knows that Nigeria needs such a campaign.

Hieronymus Bosch

This anonymous commentator is our insider in the world of offshore oil and gas operations. With decades in the business and a raft of contacts, this is the go-to column for the behind-the-scenes wheelings and dealings of the volatile offshore market.