Dallas, Texas 07/07/2015 (Financialstrend) – Erin Energy Corp (NYSEMKT:ERN) has reached an agreement with Northern Offshore International Drilling Company over matters related to the drillship ‘Energy Searcher.’ The agreement entails the two companies settling all the disputes and claims between them.
Contract Termination Claims
Late last year, Erin Energy Corp (NYSEMKT:ERN) was forced to stop drilling operations at its Oyo-8 well after discovering leaks in some of the control systems hoses. At that time, Northern Offshore drillship was under contract at the well. Suspension of drilling operations at the site meant that Northern Offshore consolidated results for the third quarter would amount to thirty-nine days of zero revenues.
Things turned worst early this year when Northern Offshore opted to terminate Erin Energy Corp (NYSEMKT:ERN) contract for the drillship. A breach of various terms of drilling was cited as the reason behind the termination.
Erin Energy Corp (NYSEMKT:ERN) issued a statement later claiming it was the one that had terminated the contract and not the other way. However after months of negotiation the two companies seem to have sorted out the mess.
The Settlement comes on confirmation that the company has already commenced production at the Oyo-7 well in Nigeria. Senior Vice President of Exploration and Production, Segun Omidele expects the well to perform in line with expectations as they move to optimize the flow rate.
Russell Index Addition Good For Business
Separately, Erin Energy Corp (NYSEMKT:ERN) Vice President and Chief Financial Officer Chris Hearne expects the addition of the stock into the Russell 3000Index to be good for enhancing the company’s profile and awareness.
The addition of Erin Energy Corp (NYSEMKT:ERN) into the index should help in generating greater interest among institutional investors, according to the executive. Institutional investors and investment managers use the index as a benchmark for active investment strategies.
