Norwegian contractor Reach Subsea and P&O Maritime Logistics have agreed on a revised charter agreement for the vessel Topaz Tiamat.
Under the new deal, Reach will operate the vessel for the remainder of the 2020 season on pay-as-you-go terms.
Consequently, the Oslo-listed subsea player will demobilise from the vessel by December 2020.
Reach originally chartered the Topaz Tiamat for a firm period lasting until August 2021, plus options.
According to IFRS 16, the vessel has also been accounted for as a right-of-use-asset, with a corresponding lease liability.
The accounting implications of the revised charter agreement are that:
1) Reach will see assets reduced by approximately NOK 90 million;
2) The deconsolidation of Topaz Tiamat will result in a one-off accounting gain, and
3) P&O Maritime Logistics will purchase LARS that Reach has installed onboard the Topaz Tiamat for approximately NOK 25 million.
Jostein Alendal, CEO of Reach, said: “We have had a great co-operation with P&O Maritime Logistics and have together successfully introduced a new state of the art subsea vessel to the market, which from next year will move on to a new assignment in another part of the world.
“With this new charter agreement in place, we have made a substantial improvement to our financial robustness and cost position for the upcoming winter season.
“However, we need to find a replacement vessel for the two ROVs currently onboard the Topaz Tiamat for 2021 and beyond, but we believe this is a good time for finding a competitive vessel replacement for the coming years.”