Here’s why Keppel’s O&M woes are worse than you think

The firm is expecting a “harsh” winter.

While a long storm is currently plaguing Singapore’s offshore and marine firms, Keppel is notably changing its tone, saying that it’s facing a harsh one.

According to a report by UOB Kay Hian, Keppel says demand for new drilling rigs will not return soon, and will likely come earliest in 2020.

“Whilst Keppel is diversifying into other product classes, contracts values are not likely to repeat those seen in the last rig construction boom,” UOB Kay Hian said.

Meanwhile, project deferrals are also here to stay for Keppel, as it has agreed to defer delivery of three jackups for Grupo R and one jackup for Parden Holdings to 2017.

“These rigs were originally scheduled for delivery in 4Q15. On the question of the status of its two FLNG orders with Golar (Gimi and Gandria), management declined comment, hinting that the project remains in limbo,” UOB Kay Hian said.