Two New Orders Help Ezra Step Up Offshore Services

Ezra Holdings Limited, a leading integrated offshore support and marine services provider in the offshore oil & gas (O&G) industry, is stepping up its lead in the oil & gas (O&G) deepwater offshore support services segment with its latest order for two new vessels totaling S$95 million.

The first contract, worth S$69 million, was awarded to Keppel Singmarine Pte Ltd, to construct a 30,000 brake horsepower (bhp), Rolls-Royce designed UT788 CDL model, Multi-Functional Support Vessel (MFSV), an upgrade from the current two UT788s being built in Drydocks World, Singapore.

To be delivered in 2010, it will join Ezra's fleet of four other deepwater MFSVs on order which will spearhead the Group's move into harsh environment deepwater offshore support services work. The other MFSVs are slated to be delivered in 2009 and 2010. This MFSV can accommodate 100 personnel at any time, will have a bollard pull in excess of 300 tonnes and Dynamic Positioning System 3 capability, which enhances the vessel's redundancy. This is such that overall operations will not be affected in the event of fire or flooding in one part of the vessel. In addition to deepwater anchor handling, towing and supply operations, the vessel will be able to carry highly hazardous liquids, as well as perform deepwater well-installation and well intervention services.

The Group has also ordered a new twin-screw anchor handling tug supply vessel (AHTS) from Singapore Technologies Marine Ltd for S$26 million. The AHTS with Dynamic Positioning system 2 (DP2), is designed for multi-purpose roles and operations in unrestricted waters, with capabilities ranging from anchor handling, transporting liquid cargo for supply runs, towing and mooring drilling rigs, standby and rescue services as well as external fire fighting. Its excellent maneuverability and station keeping is achieved using twin controllable pitch propellers, twin rudders and transverse bow and stern thrusters linked to a DP-enabled joystick control.

Said Ezra's Managing Director, Mr Lionel Lee: "In line with our long-term goals, we are adding swiftly to our deepwater offshore support services capability. Our fleet of five MFSVs will spearhead our move into the buoyant offshore O&G sector in the North Sea, South American and West African markets for harsh environment deepwater offshore support services work.

"The new orders demonstrate our commitment to our fleet expansion program. Being the first in Asia to venture into the deepwater space, Ezra continues to maintain its leading position in the segment, and will benefit as O&G exploration moves into deeper waters.

We are confident of growing our market share in this area.

"We have selected Keppel and ST Marine as our preferred choice of yard as this can be clearly proven from their outstanding and reputable track record in the timely delivery of good quality work."

Ezra expects to finance its fleet expansion through a combination of internal funds and bank borrowings. Both contracts are solely for the fabrication of hull construction and do not include the owner-furnished equipment, such as the engines and cranes.

The Group recently announced the conclusion of charters worth US$77.6 million for its five AHTSes, an anchor handling tug (AHT) and the Lewek Chancellor, the Group's heavy lift accommodation crane barge, for periods as long as three years, excluding extension options. These seven vessels will operate in Southeast Asia, India and Australia.

In April, the Group surprised the market with a strong leap in 1H FY08 net attributable profit to S$207.4 million. Ezra's active capital management efforts have also significantly bolstered its balance sheet: The Group slashed its net gearing to 6.4% in the first half from 77% in FY07 while its interest cover improved significantly to 42x.

Specializing in offshore support and marine services, Ezra is unique in the offshore oil & gas industry because it offers an integrated range of vessels for charter across a broad spectrum of the support supply chain.

Ezra manages and operates a young fleet of anchor handling, towing & supply vessels (AHTSes), anchor handling tugs (AHTs) and fast crew utility boats, which offer transport & logistics support services that span an oilfield's entire life cycle. Its self-propelled jack-up rig is used in production support work.

The construction & production arm, under 48.9%-owned EOC Limited, offers offshore construction & maintenance services, prefabrication work, installation & commissioning work and transportation services. It manages two heavy lift accommodation crane barges, a pipelay vessel and a floating production, storage and offloading facility (FPSO).

Ezra also offers marine & offshore support engineering and training services, and marine supplies. Fabrication and engineering services are offered out of Vietnam through HCM Logistics. The Group also sources specialty products such as customized safety equipment packages. Ezra's Energy Services Division will tap into new growth areas as more oilfields enter the production phase. It offers well intervention, well stimulation, hydraulic workover, coil tubing, drilling, cementing and well abandonment work.

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