Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: SliderOnTheBlack who wrote (51439)	9/20/1999 8:09:00 AM
From: Big Dog	Read Replies (1) of 95453

Slideer, I think you are a bit confused over the $143 mm FGI order you term as "spec". It is not a spec order. It is an order that has been placed by Schahin Group of Brazil. It is an order for a new rig, not a conversion or refurb. And physical construction has not yet started. Steel has not yet been ordered. FGI is still waiting for Schahin to complete financing for the rig. Everything (all engineering, etc.) is ready to go. Schahin is using US Govt.-backed loan guarantees from MARAD Title XI. It is my understanding all that is left to obtain approval of the guarantee is a letter from Petrobras confirming the 6-year contract that Schahin has for the rig. Word on the street is that Petrobras will not cancel the contract. This whole process has taken way too long. But I know that FGI is making every effort to finalize the deal, and I expect we will hear shortly that the financing has been completed and construction will begin. I agree that including the $143 mm in the backlog may have been premature, but I understand this is allowable under GAAP. big atoffshore.com

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