Keppel Offshore & Marine Ltd (Keppel O&M), through Keppel Shipyard Limited (Keppel Shipyard) and Keppel FELS Brasil SA (Keppel FELS Brasil), has secured two contracts totaling S$170 million from repeat customers for the conversion of a Floating Production Storage and Offloading (FPSO) vessel and repair of a semisubmersible (semi) drilling rig respectively.
Mr Tong Chong Heong, CEO of Keppel O&M, said, “Keppel has been providing offshore and marine solutions to the Brazilian market for more than 30 years. Together with our customers, we have pushed the boundaries to meet the unique challenges of Brazil’s offshore operating environment.
“These latest contracts reinforce the strong partnerships we have built, and attest to the versatility and technological expertise which have enabled the Company to undertake a variety of complex projects seamlessly across its global yards. I would like to thank our long-time customers SBM and Queiroz Galvão Óleo e Gás (QGOG) for their continued confidence in Keppel as we fortify our offerings as the total solutions provider for the Brazilian market.”
The first contract is for the conversion of the Very Large Crude Carrier (VLCC), M/T Theseus, into an FPSO facility for Single Buoy Moorings Inc (SBM).
Keppel Shipyard’s scope of work includes the hull and marine conversion, upgrading of the accommodation, fabrication and installation of the flare tower, helideck, spread-mooring system, topside module supports as well as part of the topsides modules installation. Work is expected to commence in the third quarter of 2010.
Scheduled to leave Keppel Shipyard in the first quarter 2012, the vessel will head to Brazil where the installation and integration of topsides will be completed. The FPSO will subsequently be chartered to Petrobras Netherlands for deployment in the deepwater Tupi Nordeste area (a partnership between Petrobras, BG Group and Galp Energia) located in Santos Basin, Brazil.
Mr Tony Mace, Chief Executive Officer of SBM Offshore said, “Our projects with Keppel are progressing well and we are pleased to award another FPSO conversion to them. We have built a successful partnership with Keppel resulting in 13 high quality projects delivered since 2001. I look forward to continuing this partnership as we build up our FPSO fleet.”
Keppel Shipyard’s current projects with SBM include the conversions of FPSO Okha and FPSO Aseng. In addition, the FPSO P-57 is currently undergoing installation and integration of its process modules at Keppel’s BrasFels yard in Angra, Brazil.
The second contract is by Keppel FELS Brasil with Queiroz Galvão Óleo e Gás (QGOG) for the repair and maintenance of their semi drilling rig, Alaskan Star.
The workscope includes structural repairs, piping works, mechanical, accommodation outfitting and painting. Expected to be completed in October 2010, the rig will be chartered to Petrobras for deployment in the Campos Basin, Rio De Janeiro, offshore Brazil.
Keppel FELS is presently undertaking the construction of QGOG's second DSSTM 38 unit, Alpha Star, having delivered the first DSSTM 38 semi to QGOG in October 2009. QGOG is one of Brazil's largest private groups in the oil and gas sector, and is supported by a 30,000-strong workforce.
Keppel FELS Brasil, a wholly owned subsidiary of Keppel Corporation Limited through Keppel O&M, operates BrasFELS yard in Angra dos Reis, which is the most comprehensive shipyard in the Southern Hemisphere.
Keppel Shipyard is a wholly owned subsidiary of Keppel Corporation, through Keppel O&M, a leader in offshore rigs, ship repair and conversion and specialised shipbuilding. Keppel O&M’s near market, near customer strategy is bolstered by a global network of 20 yards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the group aims to be the provider of choice and partner for solutions for the offshore and marine industry.
The two contracts are not expected to have any material impact on the net tangible assets and earnings per share of Keppel Corporation Limited for the current financial year.