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Keppel O&M's contracts bucked declining trend in 2017
It bagged over $1.1b contracts last year.
Keppel Offshore & Marine (O&M) bagged $1.1b worth of contracts in 2017, avoiding a trend of decline amongst other industry players.
According to DBS Equity Research, this value doubled over the worth of new orders in 2016. Around $2.5b new orders are expected in 2018.
New orders are expected to come from gas and FPSO projects which are buoyed by sustained oil prices above US$60/bbl.
Moreover, gas related products such as Floating Liquefied Natural Gas (FLNG) vessel, Floating Storage Regasification Unit (FSRU) are also expected to gather steam.
DBS analyst Pei Hwa Ho said, “These high value-add products could potentially emerge as the next “KFELs B Class” – Keppel’s most successful jackup rig design that is held in high regard by operators.”
However, annual revenues can also fall to the $2.6b level in 2017 and 2018, significantly lower than $7-8b in 2012 to 2014.
“The continued depletion of its orderbook and deferments/cancellations could pose downside risks to our forecast,” Ho added.
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