Singapore’s Marco Polo Marine has unilaterally terminated a $214.3m rig order at Sembcorp Marine’s PPL Shipyard, and the rigbuilder has regarded its client’s action as a breach of the contract.

Marco Polo Marine said its decision to terminate the rig construction contract was due to various factors including cracks found on all three legs of the new rig during two rounds of tests, notwithstanding repair works carried out by PPL after the first round of tests.

The contract was entered into in February 2014 between Marco Polo Drilling and PPL for the construction of a high-specification jack-up rig based on PPL’s proprietary Pacific Class 400 design.

“In view of the termination of the rig construction contract, Marco Polo Drilling will not be taking delivery of the new rig and it will be seeking, among others, a refund from PPL of the initial amount of 10% of the contract price previously made to PPL pursuant to the rig construction contract together with interest,” Marco Polo Marine said.

Sembmarine subsequently issued a statement saying that PPL “disagrees with the allegations (…) and will regard this as repudiatory breach of the contract.”

It added that it “will terminate the contract and claim amounts due under the contract against Marco Polo Drilling and its guarantor Marco Polo Marine.”