Keppel strengthens stock appeal with new contracts

The shipping company’s Brazilian yard secured two FPSO topside contracts worth S$381.4mln.

Keppel FELS Brasil’s first contract is with Single Buoy Moorings Inc (SBM) and involves the fabrication and installation of topside modules on the Floating Production Storage and Offloading (FPSO) vessel Cidade De Paraty.

The deal, which was awarded in association with Queiroz Galvão Óleos e Gás S.A. (QGOG), has a work scope including the fabrication and installation of six process modules and a riser gantry as well as the installation and integration of another six process modules supplied by SBM.

Work on the project is expected to commence in BrasFELS shipyard 1Q11. The vessel, meanwhile, is currently undergoing conversion at Keppel Shipyard in Singapore, and is scheduled to arrive in Brazil in 1Q12 before undergoing the next stage of topside integration work.

The FPSO, which will be deployed in the pre-salt region of Santos Basin, will have a production capacity of 120,000 bbl of oil and a compression rate of 5m cubic meters of gas per day.

The second contract involves module fabrication and integration of the FPSO Cidade de Sao Paulo
MV23 for Modec and Toyo Offshore Production Systems JV Company (MTOPS).

The project is expected to begin also in BrasFELS yard in 1Q11, with expected completion in 4Q12.

The FPSO will have a production capacity of 120,000 barrels of oil per day, be able to compress 180m cubic feet of gas per day, and have storage capacity for 1.6m bbls of oil.

DBS Bank said that in just the first 2 months of the year, KEP has already secured order wins of c. S$2.0bn, making up 44% of the bank’s FY11 ex- Petrobras order wins assumption of S$4.5bln.

“On the back of such strong order flows YTD, there may yet be upside to our order wins assumption,” DBS said.