Sembmarine's US$696m deal seen as timely

Singapore

SEMBCORP Marine's announcement of a new contract secured this week could not have come at a better time as the rigbuilder's stock has been taking a beating due to low oil prices, doubts over the timely delivery of a drillship and sluggish contract wins.

Sembmarine confirmed this week that its wholly owned subsidiary, Jurong Shipyard, had won a US$696 million deal to convert a shuttle tanker into a floating, production, storage and offloading (FPSO) vessel for OOGTK Libra, a joint venture between Brazil's Odebrecht Oil & Gas and Teekay Offshore. Set for delivery in third-quarter 2016, the project will have the capacity to produce 50,000 barrels of oil per day and four million cubic metres of natural gas per day. It is expected to be chartered to Petrobras for 12 years on the Libra field in the ultra-deepwater section of Brazil's Santos Basin.