Keppel Bags 3 Conversion Contracts

Keppel has secured three conversion contracts worth a total of S$142 million. These conversion contracts are to convert a Liquefied Natural Gas (LNG) Carrier to a Floating Storage Unit (FSU), a VLCC tanker to a Floating Storage and Offloading (FSO) unit as well as a tanker to a Floating Production Storage and Offloading (FPSO) unit.

Mr Nelson Yeo, Managing Director of Keppel Shipyard, said, "We are glad to have the trust and confidence of the global industry for a range of conversion projects. Working closely with our customers, we will continue to enhance and extend our capabilities, and ensure safe and high quality deliveries."

The first contract is for the fast-track conversion of the LNG carrier Tenaga Empat into a FSU for Malaysian customer MISC Berhad. When completed in 2Q 2012, the FSU will have a storage capacity of 130,000m3 and operate in the newly-developed Melaka LNG Import Terminal.

The second contract is from Dixstone Holdings Ltd, an affiliate of the Perenco Group (Perenco), which is in turn a partner of the Cameroon National Hydrocarbons Corporation (SNH), for the modification and upgrading of the FSO Massongo. Work is expected to commence at the end of this year. The scope of work includes refurbishment and life extension works; fabrication and installation of the cargo offloading balcony and helideck; installation and integration of a 14-point spread mooring system and the upgrading of the accommodation facilities. The available storage capacity of the vessel will be two million barrels of oil, with four wing ballasts tanks to be converted into cargo tanks. When completed in 3Q 2012, FSO Massongo will replace both FSO Kingsway (Rio Del Rey Basin) and FSO Moudi at Moudi field located 20 miles apart.

Keppel Shipyard's third contract is for the conversion of the tanker Umbe into a FPSO unit for Bumi Armada Berhad (Bumi Armada). Keppel Shipyard has been entrusted with all of Bumi Armada's conversion projects to date; this latest FPSO contract is the seventh collaboration on major projects between the two companies.

Slated for completion in 4Q 2012, the FPSO will have a production capacity of 50,000 barrels of oil per day (bopd), and a storage capacity of 580,000 barrels of oil. The FPSO has been chartered by Oil and Natural Gas Corporation Limited (ONGC) for deployment in the D-1 field, which is located 200 kilometers west of Mumbai, India.

The above 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.


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