Jurong Shipyard Bags FPSO Conversion Proj. from MODEC

Jurong Shipyard, a wholly-owned subsidiary of Sembcorp Marine, has secured an approximately S$130 million project to convert the Very Large Crude Carrier (VLCC) tanker, the MV TAR II (ex STAR II), to a Floating Production Storage and Offloading (FPSO) vessel for MODEC.

This conversion project involves the installation of an external turret mooring system and process facilities, which include gas turbine generators, oil separation, gas injection/gas lift and water injection system. Planned delivery to MODEC is 2Q 2013.

The FPSO is designed to operate for 20 years without dry-docking and it will have production capacity of 100,000 barrels of oil per day and a storage capacity of 1,600,000 barrels of oil.

The FPSO will be delivered to OSX Leasing B.V. for deployment in offshore Brazil, located in water depths of approximately 110 meters.

This conversion project is not expected to have any material impact on the net tangible assets and earnings per share of Sembcorp Marine for the year ending December 31, 2011.