SERVICE SECTOR / Petrobras Will not Guarantee Payment for Amethyst
NASDAQ SYMBOL: DBCO
VSE SYMBOL: DMO.U
NOVEMBER 13, 1998
MONTREAL, QUEBEC--Following the cancellation of its Amethyst
contracts and after discussions over the past few days between
Petrobras and representatives of Dominion Bridge Corporation,
Dominion Bridge has been notified that Petrobras would not
guarantee payment for the Amethyst platforms. Petrobras has
explained to Dominion Bridge Corporation representatives that it
had decided to maintain its established policy, which is that the
company itself neither owns nor operates drilling platforms, nor
guarantees payment to secure their construction. As in the past,
Petrobras plans to continue having offshore drilling done by
specialized contractors.
In the wake of the Petrobras announcement, Davie's situation is as
follows:
1. Davie Industries will continue work on the "Spirit of Columbus"
project which currently provides jobs for nearly 800 people. The
project is scheduled for completion in the summer of 1999.
2. Despite the Petrobras decision, Davie Industries and Dominion
Bridge Corporation executives remain determined to ensure a solid
basis that would guarantee the shipyard's long-term growth. The
company continues its restructuring plan and is studying various
scenarios. These scenarios may include the participation of
Quebec-based, Canadian and foreign interests.
3. Davie Industries has state-of-the-art expertise relating to
engineering and construction of complex marine products, such as
semi-submersible rigs like the Amethyst, and other marine
products. These technologies will remain in great demand for years
to come. Davie plans to make the most of its capabilities while
continuing to sell its products and related services such as
engineering, notably to its Korean and American clients, and will
continue its effort to expand in these markets.
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