Transocean CEO Steve Newman. Image courtesy of Transocean/Youtube.

Transocean has delayed its third quarter results as the company faces nearly $2.8 billion in writedowns as demand for drilling rigs weakens.

The company said Friday that its third quarter results will take a $1.97 billion non-cash charge related to the impairment of goodwill “due to the decline in the market valuation of the contract drilling business.”

As of June the company’s goodwill stood at about $2.99 billion.

Switzerland-based Transocean also expects to take an additional $788 million impairment on its deepwater rigs “due to the deterioration of the market outlook, reflecting the recent decline in dayrates and utilization for this particular rig class.”

The company has not disclosed when it expects to release its third quarter results.

Over the past three years Transcoean has sold over 60 rigs and completely exited its standard jack-up rig flotilla to focus on ultra deepwater and harsh environment vessels.

Four of the company’s six floating units working in offshore Norway are set to come off contract in 2015.

The company also has eight ultra deepwater rigs in various countries that are either idle or coming off charter in the fourth quarter of this year.

Earlier this week Norway’s Statoil suspended its charter of the semi-submersible Transocean Spitsbergen until the end of the year, cutting the rig’s dayrate.

During the past year dayrates for rigs operating in offshore Norway have dropped by 20 percent to 30 percent, according to Pareto Securities.

Statoil said it could extend its shelving of the rig into 2015 if needed.


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