Brazil's OGX collapse leaves no significant impact on Keppel: DBS

Here's the saving grace.

OGX has run into cash flow problems from loss making operations as it repeatedly failed to meet output targets and delays from turning start-ups
into revenue producing projects.

OGX’s woes were compounded as it declared 3 of its oil fields are non commercial and stopped production, As a results, it had to cancel contracts for production units at OSX, with compensation amounting to US$449m.

Both Keppel and SMM secured one FPSO conversion job each from OSX through SBM/Modec in 2011.

"We understand SMM has delivered the vessel and Keppel is close to completing the unit as well. We do not expect any material impact from this incident as OSX has agreed to take delivery of these vessels and seek buyers subsequently," says Janice CHUA, analyst at DBS.