Shares of Bermuda-based Northern Offshore yesterday plunged 10 percent after the company announced a profit of $16.6 million for the fourth quarter.

On the same day the operator of oil and gas drilling vessels suffered a 10 percent drop in share value to 1.8 Norwegian crowns (NOK), its lowest level since December 2006. So far this year the stock has lost nearly 40 percent in value.

Revenue was $71.5 million, compared to $43.6 million in the same period of 2007, when the company posted a net loss of $5.6 million.

The net income for 2008 was $64.1 million compared to $34.5 million in the prior year.

The revenue for the full financial year 2008 was $271.4 million, a sharp increase from the $176.1 million reported in 2007. Northern Offshore explained that the increase in revenue was due to higher day rates for its three North Sea jackup rigs which it purchased in June 2007, as well as higher utilisation and day rate for the semisubmersible 'Energy Driller'.

The revenue growth was partially offset by the lower utilisation of the drill ship Energy Searcher which was awarded a contract with Vietgazprom, a joint venture between Petrovietnam and Gazprom, due to commence mid 2009.

The 2008 fourth-quarter results included a $2.2 million provision for doubtful receivables.

On February 22 the company announced that it had made the required filing with the Oslo Stock Exchange with regards to $15 million accounts receivable with Gazflot, a wholly owned subsidiary of Gazprom, and that it intends to pursue its remedies for collection under the terms of the agreement with Gazflot.