Hornbeck Offshore lawsuit calls for return of two unfinished vessels

By Caroline Salls

Pittsburgh, June 4 – Hornbeck Offshore Services, Inc.’s Hornbeck Offshore Services, LLC debtor filed a lawsuit Wednesday that asks the U.S. Bankruptcy Court for the Southern District of Texas to order Gulf Island Shipyards, LLC to turn over two multi-purpose support vessels.

Under vessel construction agreements entered on May 10, 2013, the contract price for the two vessels totaled $174.45 million, and Hornbeck has paid Gulf Island $124.27 million of that amount.

Hornbeck alleged in the complaint that Gulf Island defaulted under the agreements and failed to perform its work on time. As a result, the agreements were terminated in March 2018.

“Although the agreements permit plaintiff to have the work completed at a replacement shipyard when the agreements have been terminated, Gulf Island has refused to release the vessels to plaintiff, claiming that additional monies are owed it for unbilled work,” the lawsuit said.

Hornbeck said Gulf Island said its claim is secured by a security interest and that it has a right to possess the vessels under Louisiana law.

Hornbeck said its proposed plan of reorganization calls for its to obtain possession of the vessels and fund their completion through the incurrence of $65 million of financing. However, the company said Gulf Island has refused repeated requests, as well as a formal demand, to turn over the vessels.

Hornbeck is a Covington, La.-based provider of offshore supply vessels primarily in the Gulf of Mexico and Latin America. The company filed bankruptcy on May 19 under Chapter 11 case number 20-32679.

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