Petrofac Ltd said Thursday it was ending its “advanced stage” financial restructuring after TenneT dropped the British energy engineering company from multiple projects.
“Having carefully assessed the impact of TenneT’s decision, the board has determined that the restructuring, which had last week reached an advanced stage, is no longer deliverable in its current form”, Petrofac said in a statement on its website.
“The Group is in close and constant dialogue with its key creditors and other stakeholders as it actively pursues alternative options for the Group.
“In the meantime, Petrofac remains focused on serving its clients and maintaining operational capability and delivery of services across its businesses.
“Further information will be shared in due course”.
European grid operator TenneT said Thursday it had terminated Petrofac’s scope under a March 2023 agreement also signed with Hitachi Energy Ltd for six direct current connection projects on the Dutch and German sides of the North Sea. The projects each have a capacity of two gigawatts.
“Since 2024 Petrofac has been working on a financial restructuring of its business”, TenneT said in an online statement. ”In the past period TenneT has worked extensively with the Petrofac/Hitachi Energy consortium on mitigation measures.
“Since Petrofac has not been able to meet its contractual obligations, TenneT has exercised its right to partial termination of the contract related to the Petrofac scope.
“At the same time, a solution has been put in place involving a consortium of Hitachi Energy and a replacement contractor. Hitachi Energy and the replacement contractor will be responsible for the project portfolio of the Dutch offshore grid connections IJmuiden Ver Alpha, Nederwiek 1, Nederwiek 3, Doordewind 1, Doordewind 2 and the German offshore grid connection LanWin5”.
On September 11 Petrofac said it had reached an agreement in principle with Saipem SpA and Samsung E&A Co Ltd on their claims from a failed project in Thailand that derailed Petrofac’s restructuring plan.
“The commercial terms are supported by the Ad Hoc Group of Bondholders, subject to the agreement of longform documents”, Petrofac said in a brief online statement at the time. “This agreement will enable the restructuring to proceed with the consent of those parties.
“The Group will now work to conclude discussions with key stakeholders on next steps towards implementation of the restructuring. It is expected that, subject to receipt of all requisite approvals and satisfaction of conditions, the restructuring will be completed by the end of November 2025”.
On July 1, in favor of Saipem and Samsung E&A, the Court of Appeal repealed the High Court of Justice’s sanction for Petrofac’s restructuring. Petrofac and the two companies had been part of a discontinued project, called Clean Fuels Project, to enable the production of cleaner fuels at a Thai refinery.
Claims by Saipem and Samsung and those of other parties to the Thai project “will be compromised” under the restructuring plan, the Court of Appeal said in its decision, published on the UK judiciary’s website.
On August 1 Petrofac said it would apply to the United Kingdom Supreme Court for leave to appeal the reversal of the High Court’s sanction.
“The board has identified and is actively progressing a number of routes to deliver the restructuring, including through a plan that addresses the narrow grounds on which the Court of Appeal issued its judgment on 1 July 2025”, Petrofac said in the August statement.
The statement said bondholders, investors and creditors party to a lock-up agreement for the restructuring had agreed to extend the agreement to November.
“The agreement of stakeholders to extend the lock-up demonstrates their support for the work underway to address the narrow grounds on which the Court of Appeal upheld the challenge to our restructuring plan”, Petrofac chief executive Tareq Kawash said then.
According to the August statement Petrofac had $192 million in net liquidity at the end of the second quarter.
In an update October 17 Petrofac said the restructuring “will result in no residual value being retained by existing shareholders”.
Petrofac expected the restructuring plan to unlock $355 million in new funding, which would “significantly reduce the Group’s indebtedness, materially strengthening its financial position”, as per a company statement May 20.
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