SINGAPORE (Sept 14): Mermaid Maritime announced Thursday that it has won a long-term submarine cable survey contract in the Middle East worth an estimated US$7 million ($9.4 million).

Scheduled to start in 3Q 2017, the work involves the use of a Mermaid chartered-in vessel with geophysical survey personnel, equipment and a survey class ROV onboard to carry out survey of a submarine cable network.

The contract is for 21 months, with an option for further cable inspection work at additional rates.

Separately, the group has issued a statement to declare that its 33.76%-owned subsidiary, Asia Offshore Drilling (AOD), is expected to be “largely affected” by Seadrill’s Chapter 11 filings.

Seadrill holds the remaining 66.24% equity interest in AOD.

In an aftermarket filing on Thursday, the group highlights that AOD and its subsidiaries did not file Chapter 11 cases, and thus their business operations are expected to be largely unaffected by Seadrill's Chapter 11 filings.

It also emphasises that as part of Seadrill’s Chapter 11 cases, “first day” motions were filed that, when granted, will enable day-to-day operations to continue as usual, including the provision of management services to Seadrill’s subsidiaries inclusive of AOD.

As part of Seadrill’s restructuring agreement, Mermaid and its subsidiaries have been granted a temporary waiver and forbearance from default that may have arisen under AOD’s bank credit facility agreement.

AOD has about US$210 million outstanding under its bank credit facility, which matures in April 2018.

See: These 2 O&M stocks are exposed to the Seadrill fallout. Which to buy?

The group adds that AOD will continue to evaluate its options to reach a consensual solution among its shareholders and lenders on this matter during the interim period.  

Shares in Mermaid closed 0.8% lower at 12 cents.