Sembcorp Marine clinches $400 mil in new contracts

SINGAPORE (Sept 2): Sembcorp Marine has won a slew of new projects valued at $400 million ranging from engineering solutions for offshore gas and wind farm developments as well as cruise ship upgrades.

In these contracts, SembMarine teamed up with various repeat and new customers. The group also succeeded in breaking into the highly competitive offshore wind sector in Taiwan.

Sembcorp Marine Rigs & Floaters and joint venture companies of Shapoorji Pallonji Oil and Gas and Bumi Armada agreed to convert Ariake, a very large crude carrier (VLCC), into a floating production, storage and offloading (FPSO) unit for deployment in the east coast of India. The vessel will produce up to 90,000 barrels of oil per day (BOPD) and have a 1.3-million-barrel storage facility.

Sembcorp Marine Repairs & Upgrades also added three new gas projects to its portfolio. These were the conversion of LNG tanker Dwiputra into a 125,000cbm floating storage and regasification unit (FSRU) for a JV between Mitsui O.S.K. Lines (MOL) and Karpower International B.V.; Conversion of NYK Line’s former gas carrier LNG Flora into a 127,000cbm floating storage unit (FSU) for Gasfin Development S.A.; and upgrading works on the 173,400cbm FSRU BW Magna for BW LNG.

Sembcorp Marine Repairs & Upgrades will also lead the makeover of Asuka II – Japan’s largest cruise ship – for NYK Cruises. To be executed over 45 days at the Admiralty Yard from January 2020, the project includes installing a sulphur oxide scrubber unit on the vessel to comply with new environmental regulations effective next year.

Sembcorp Marine Offshore Platforms also landed a contract with Jan De Nul n.v. to fabricate 15 jacket foundations for the Formosa 2 Offshore Wind Farm. Located 4km offshore Miaoli County in the Taiwan Strait, the 376MW Formosa 2 facility will be Taiwan’s largest offshore wind farm, generating sufficient electricity for over 380,000 households when it starts operation in late 2021.

SembMarine president & CEO Wong Weng Sun says: “Despite the challenging market conditions, we have been steadfastly pursuing the available pockets of opportunities. I am very pleased that our teams have translated several of these opportunities into new contracts. As we respond to current market enquiries and customer requirements, Sembcorp Marine will continue to innovate and improve our capabilities, so that we can sustain our long-term competitiveness by having the best solutions for the evolving global offshore, marine and energy industries.”

The contracts are not expected to have any material impact on the net tangible assets and earnings per share of SembMarine for the year ending Dec 31.

Shares in SembMarine last traded at $1.14, down 26.4% year to date.