IHC Caland Receives $440 Million in New Orders

IHC Caland N.V. has received of a number of orders in its offshore as well as the dredger and specialised shipbuilding division.

IHC Caland's fully owned subsidiary Atlantia Offshore Ltd of Houston, received a Letter of Intent from the Atwater Valley Producers (AVP) group for the design and supply of a semi-submersible platform to support the production facilities for a number of gas fields located in the Gulf of Mexico in water depths in excess of 8,000 feet. The AVP group includes Anadarko Petroleum, Devon Energy, BHP Billiton and Kerr-McGee. This award results from the success of the Atlantia design over the SPAR concept and alternative semi submersible designs, in the FEED design competition initiated by the AVP group earlier this year. This success is the result of synergy with Gusto-MSC-OceanDesign Inc (GMOD), another Houston-based fully owned subsidiary of IHC Caland, which has largely contributed to the design of the facility. Delivery of the platform is scheduled for March 2006.

Single Buoy Moorings Inc (SBM), a fully owned subsidiary of IHC Caland, has received from a major European oil company a Letter of Intent for the design and supply of three flash gas compression barges which will form part of the infrastructure for a field development in the Caspian Sea. This order was obtained in partnership with Siemens Demag Delaval Turbomachinery BV, the Netherlands, who will supply the turbo compressors. The first two barges are scheduled for delivery by the middle of 2006, with the third following a year later.

SBM's FPSO Jamestown, idle since her replacement by the larger FPSO Mystras as production vessel under the long-term lease contract with Agip Nigeria at the Okono field, has been sold to a joint venture between Trafigura and NNPC. The unit will be deployed by the new owners offshore Nigeria. The sale of this small unit, primarily sized for short-term EPS projects, is part of the policy of the Group to focus its lease fleet on medium and large size units with full field development capabilities.

In the area of tanker loading and discharge terminals SBM secured orders from Trafigura Construction Ltd for the supply and installation of both a Catenary Anchor Leg Mooring system (CALM) as well as a spread mooring system for the Tema refinery in Ghana, and from EIL for the supply of a CALM system to be installed in the Sagar Lakshmi field offshore India.

The cumulative value of the above orders in the offshore division amounts to approximately US$ 340 million.

Merwede Shipyard, a wholly owned subsidiary of IHC Caland, was awarded a contract by Tenix Defence PTY, Ltd. of Australia for the design, engineering and construction of one multi-role vessel. In the international naval market Tenix Defence is an established and reputable supplier of various naval vessels and a proven partner of the Royal New Zealand Navy, which will operate the vessel. The multi-role vessel is part of a total of seven vessels that will be supplied by Tenix Defence to the Ministry of Defence of New Zealand. The multi-role vessel meets or exceeds all operational requirements of the New Zealand Ministry of Defence, including those for cargo and troop carriage, speed, endurance, helicopter operations and the secondary role of Exclusive Economic Zone (EEZ) patrol and response. The construction period of the multi-role vessel is 22 months.

Merwede Shipyard also signed a contract with the Norwegian company Solstad Shipping AS for the construction and delivery of one offshore supply vessel with an over-all length of 86.2 metres. The delivery of the vessel is foreseen in the third quarter of 2005. The effective date of the contract will be confirmed shortly.

The cumulative contract value of both orders for Merwede Shipyard amounts to approximately US$ 100 million.

New deep offshore installation vessel

In anticipation of the increased activities of the major oil companies in deep and ultra-deep water, in particular in the Southern Atlantic, SBM has entered into a joint venture with the Norwegian company Solstad Shipping AS for the purpose of investing in a new generation offshore deep water construction and Installation Vessel. Last week the joint venture placed a contract for this vessel with the Ulstein Shipyard in Norway.

The new vessel will be a strategic tool for SBM in the market of supply and installation of offshore facilities. She will be able to install any of SBM's products (FPSO's, CALM systems) as well as those of other subsidiaries of the group (TLP's, semi-submersibles) in deep and ultra-deep water. In addition, the vessel will place the company in a strong position in the deep-water construction and installation market. The vessel will be delivered in January 2006.

Update on the shipbuilding split-off

IHC Caland's disengagement from its shipbuilding activities is progressing satisfactorily. Proposals were solicited from interested parties and several non-binding offers have now been received. On 2 August the decision was taken to continue with the sale process rather than seeking a separate listing for the independent shipbuilding group.

A shortlist of bidders has been established and the due diligence process has started. The transaction should be completed during the fourth quarter of 2004.

Management change

As planned and previously advised, following the decision to proceed with the sale of the shipbuilding activities, the Supervisory Board of IHC Caland has approved that effective 9 August 2004:

Mr. J.J.C.M. van Dooremalen will step down as President and CEO of IHC Caland, but will retain the position of Managing Director Shipbuilding division, in the Board of Management of IHC Caland until the sale transaction is completed. Within the shipbuilding division he will take up the position of President of IHC Holland, wholly owned subsidiary of IHC Caland, which position became vacant due to the retirement of Mr. J. van Sliedregt.

Mr. D. Keller, Managing Director, Offshore Division, will take the position of President and CEO in the Board of Management of IHC Caland.

Investors relations

The Board of Management has also decided to strengthen the investor relations activities of the Group. To this effect it has appointed Mr. Hans Peereboom in the position of Investor Relations Manager. Mr. Peereboom (57) has been with the Offshore division of the group since 1971.