Shipyards likely to see more asset impairments: UOB-KH

Singapore

DESPITE the Singapore offshore and marine (O&M) sector having made loss provisions of US$2.2 billion in financial year 2015 amid the global oil rout, shipyards are likely to report further asset impairments.

UOB-KayHian, which said this in a March 7 sector update, said that shipyards are more vulnerable than asset operators.

"Yards that are building drilling jack-up rigs or/and offshore support vessels (OSV) for third parties or on a speculative basis face major risks as asset values have collapsed," the report said. "If the existing customers of the rigs/OSVs under construction walk away, th…