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Brazil's Enseada yard seeks bankruptcy protection

Odebrecht-connected facility looks for financial lifeline after getting barely any orders from start-up

Brazil’s Enseada shipyard has filed for judicially-supervised bankruptcy protection after orders failed to materialise in the aftermath of Brazil’s Car Wash corruption scandal and the savage downturn in the country’s offshore sector.

The Enseada yard was built in the first part of the decade by a consortium made up of Brazilian construction and engineering firms Odebrecht, UTC Engenharia and OAS.

The consortium, initially called Estaleiro Enseada do Paraguacu (EEP), opened the shipyard for business in 2014, promising to process up to 36,000 tonnnes of steel per year.

Odebrech action on debt

All three companies were caught up in the Car Wash probe, and one of Brazil’s biggest and best-equipped shipyards has barely had an order since it opened for business.

It was one of five yards chosen to build rigs for Sete Brasil. The collapse of that Petrobras-sponsored rig-chartering company resulted in the rig orders being cancelled.

Enseada’s bankruptcy protection procedure will include a restructuring plan for about 2.3 billion reais ($564 million) of debt, according to a statement.

“This measure will make it possible to put in place a definitive financial restructuring in a way that is well co-ordinated, secure and transparent, thus allowing operational activities to continue (at the yard),” Enseada said.

The list of Brazilian shipyard companies either seeking bankruptcy protection or closing their doors since the Car Wash scandal erupted in 2014 includes the Ilha, Maua and Vard facilities in Rio de Janeiro state, the Ecovix and Eisa yards in Rio Grande do Sul, OSX in Espirito Santo, Estaleiros Amazonia in Para, Atlantico Sul (EAS) in Pernambuco and Keppel Singmarine in Santa Catarina.

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