Keppel Corporation secures two FPSO conversion contracts worth S$190m

From clients SBM Offshore and M3nergy.

Keppel Corp (KEP) has secured two floating, production, storage and offloading (FPSO) conversion contracts, reports OSK-DMG in its corporate news flash, which lifts the company's YTD new orders to S$4.3bn, or accounting for 72% of the research firm's S$6bn order win estimate for FY13.

OSK-DMG views the contracts positively "as they reflect the group’s strong execution capability and raise its net order book to S$14.4bn."

The first contract from SBM Offshore (SBMO NA, NR) is for the conversion of an FPSO unit that will be used for the Stones ultra deepwater development by Shell in the Gulf of Mexico. The FPSO is designed with a processing capacity of 60,000 barrels of oil per day (bopd) and will be able to store 800,000 barrels of crude oil.

Meanwhile, the second contract, awarded by M3nergy, involves the conversion of a FPSO for the Petronas-operated Bukit Tua Field, 35km north of Madura Island in Indonesia. The conversion is expected to be completed in 2Q14. The FPSO will have a production capacity of 25,000 bopd and a storage capacity of 630,000 barrels. We understand KEP beat other yards to the job, including Malaysia Marine and Heavy Engineering Holdings.