Keppel O&M bags S$125m of contracts

KEPPEL Offshore & Marine has won four contracts valued at S$125 million from repeat customers for conversion, enhancement and integration of vessels in Singapore and its overseas yards in Azerbaijan and Brazil.

Keppel Shipyard was awarded a contract from a Bumi Armada's wholly owned subsidiary, Armada Floating Gas Storage Ltd, for the conversion of a liquefied natural gas floating storage unit (LNG FSU), the yard group said, confirming a November BT report.

The LNG FSU conversion to be carried out in Singapore is scheduled to be completed in the third quarter of 2016. The converted FSU will operate at the Delimara LNG regasification terminal in Malta.

Keppel Shipyard was also commissioned by Yinson Holdings' wholly owned subsidiary, Yinson Production (West Africa) Pte Ltd, for the conversion of a floating production, storage and offloading (FPSO) vessel. The FPSO conversion also to be carried out in Singapore involves modification to the vessel, new equipment installation complete with associated piping, electrical and instrumentation systems and installation and integration of the vessel's topsides. The converted FPSO will be deployed to Eni-operated Offshore Cape Three Point block off Ghana.

Keppel O&M's chief executive, Chow Yew Yuen said that the LNG FSU contract is the 14th conversion or upgrading project the yard group is undertaking for Bumi Armada.

Bumi Armada has chosen Keppel Shipyard as "a trusted partner" for their first LNG FSU conversion, Mr Chow noted.

Yinson has also returned after the delivery of its first FPSO converted at Keppel Shipyard in 2012. Mr Chow said: "We will be able to leverage the past experience and close relationship to fast track this project to meet (Yinson's) requirements."

Keppel O&M's two other overseas yards, Rio de Janeiro-based BrasFELS and Baku-based Caspian Shipyard Company (CSC), secured contracts from the Singapore business unit of Modec Offshore Production Systems and the Azerbaijan-based subsidiary of BP.

BrasFELS will carry out integration and commissioning of the FPSO Cidade de Caraguatatuba MV27 under a contract from Modec Offshore Production Systems (Singapore) Pte Ltd. Cidade de Caraguatatuba MV27, which is to be deployed in the Lapa field in Brazil's Santos Basin will depart from Keppel Shipyard and arrive at BrasFELS in the second quarter of 2016. BrasFELS has successfully completed five FPSO projects ahead of schedule in the past five years, three were for companies affiliated to Modec.

CSC will be strengthening the steel structure of the hull of STB-1 Vessel, a purpose-built jacket transportation and launch barge for BP. This is the third time BP has selected CSC for refurbishment or enhancement works on STB-1. Once the hull strengthening work is completed, STB-1 will be deployed to transport and launch two jackets for BP-operated Stage 2 development of the Shah Deniz field.

Mr Chow said: "Even in challenging market conditions, we are glad to be the choice yard for (vessel) operators."

"With our wide spectrum of offshore and marine solutions, we are able to serve the various needs of the industry, be it in oil production or offshore support services," he added.

The four contracts are not expected to have any material impact on the net tangible assets and earnings per share of Keppel Corporation for the current financial year.