The unidentified purchaser of a new-design subsea vessel on the Norwegian ship expertise firm Havyard has cancelled the shipbuilding contract amid horrible circumstances in the marketplace for offshore vessels.

Havyard Ship Technology AS entered into the NOK 700 million contract with the worldwide purchaser in July 2015 calling for the design and building of a Havyard 858 L WE subsea vessel to be delivered within the second quarter of 2017.

By October, Havyard mentioned that because of the troublesome market scenario for offshore vessels internationally it agreed to postpone supply of the vessel till the second quarter of 2018. The revised contract stipulated that the customer might cancel the contract by March 2016, offered the customer pays Havyard Ship Technology an undisclosed charge.

“In light of the continuing challenges in the offshore market internationally, Havyard Ship Technology AS and the buyer have today signed an agreement for cancellation of the shipbuilding contract,” Havyard Group mentioned in an announcement asserting the cancellation. “The agreement involves payment of a compensation to Havyard.”

The firm added that the cancellation will don’t have any have an effect on for liquidity and income in Havyard Ship Technology AS for the monetary 12 months 2016, however will result in a decrease exercise and a smaller margin loss in Havyard Design & Solutions AS for 2016.

The Havyard 858 L WE is developed by Havyard Design & Solutions in Norway. The DP3 vessel was to carry out IMR (Inspection Maintenance and Repair) and light-weight building work on subsea installations. The vessel would have measured 121 meters lengthy by 24 meters extensive, and are available geared up with two cranes (250 and 30 tonnes), a moon pool, helideck, 1,500 sq. meters of deck house, and lodging for 140 folks.