Feb 28 A subsea and offshore contractor
affiliate of Ezra Holdings Ltd, a struggling
Singaporean oilfield services firm, filed for U.S. bankruptcy as
it ran short of cash due to a lingering downturn in the
The affiliate, Emas Chiyoda Subsea Ltd, said in court papers
filed in Houston that the company was suffering from weak demand
for its subsea contracting work and tightening credit
Ezra has said it may have to take a $170 million writedown
on the value of its investment in Emas Chiyoda.
Oilfield service firms have been turning to bankruptcy to
shed debt and raise cash after years of hunkering down after
energy prices tumbled from the recent peak in 2014.
Emas Chiyoda's bankruptcy comes eight months after it teamed
up with India's Larsen & Toubro Ltd to land a $1.6
billion contract with Saudi Aramco, Saudi Arabia's state-owned
oil company, to expand the offshore Hasbah gas field.
Onshore work has begun and the offshore phase of the Hasbah
project will begin later this year, said Emas Chiyoda's general
counsel, Stephen McGuire, in a court filing.
The company, which is based in Birmingham, United Kingdom,
said it had about $550 million in debt.
"As a result of the deteriorating market conditions in the
oil and gas sector coupled with the company's financial
difficulties, the company's lenders have frozen borrowing
availability," McGuire said in a court filing.
The company has requested court permission to borrow up to
$90 million to allow it continue its current projects with
minimal disruption. The company will seek access to $55 million
of the proposed loan at a hearing on Wednesday in Houston.
The proposed loan is being extended by Chiyoda Corp
of Japan and Subsea 7 S.A. of the United Kingdom,
according to court documents.
The loan requires Emas Chiyoda to file a bankruptcy exit
plan in 60 days and to have the plan confirmed by U.S.
Bankruptcy Judge Marvin Isgur, who was assigned to the case, in
Ezra of Singapore owns 40 percent of Emas Chiyoda, Chiyoda
owns 35 percent and Nippon Yusen KK of Japan owns the
remainder, according to court documents.
A creditor of a subsidiary of Emas Chiyoda filed a court
petition this month to liquidate the unit.
(Reporting by Tom Hals in Wilmington, Delaware; Editing by
Noeleen Walder, Bernard Orr)