20 Year old Angolan FSO and a Pair of LNG Carriers Destined for Sembawang Shipyard

SINGAPORE – Sembcorp Marine’s subsidiary Sembawang Shipyard, located on the northern tip of Singapore, has secured three major upgrade and refurbishment contracts today totalling S$130 million.

The first contract was awarded by Sonangol Pesquisa e Produção S.A. (SNLPP) for the repair and upgrading of FSO Palanca.  Sonangol is a state-owned company, and a subsidiary of Sociedade Nacional de Combustíveis de Angola, E.P.

The contract, signed in Luanda, Angola, calls for the major repairs and upgrading of the 20-year-old, 260,ooo DWT FSO Palanca.  Sembawang Shipyard was awarded this milestone contract on the strength of the Shipyard’s capabilities and established track record in the highly specialized and sophisticated field of FSO / FPSO offshore modification, upgrading and repair work.

Major work scope includes the renewal of the vessel’s cargo piping system and pumps, tank blasting and coating, and cables renewal for the entire electrical system. The existing 30-person accommodation block will be re-designed and rebuilt to accommodate 60 persons.   The new accommodation block will include a new helideck to meet the vessel’s operational requirements.

The vessel is expected to enter Sembawang Shipyard in August 2012 and, upon completion, will return to Palanca Terminal in offshore Angola. 

Besides the above FSO upgrading contract, Sembawang Shipyard was also recently awarded two LNG carriers life extension projects from the shipyard’s Favoured Customer Contract (FCC) client, North West Shelf Shipping Service Company, Australia (NWSSSC).   NWSSSC is the shipping service provider to the vessel owner, International Gas Transportation Company Limited (IGTC), a North West Shelf Venture company registered in Bermuda.

The 20-year-old LNG vessels Northwest Seaeagle and Northwest Sandpiper are scheduled to enter Sembawang Shipyard in June and September 2012 respectively for major repairs and upgrading which, when completed, will further extend the vessels’ trading lives for another 10 years or more.

These awards follow on the heels of the successful execution of similar, highly specialized LNG life extension work for NWSSSC’s Northwest Sanderling in 2009, Northwest Snipe in 2010 and Northwest Shearwater in 2011.

Mr. Ong Poh Kwee, Managing Director of Sembawang Shipyard, said:

“We would like to thank our partners and customers for selecting Sembawang Shipyard to execute these important contracts and for their trust and confidence in our capabilities.  These sophisticated projects demand strong engineering and project management skills to be executed in a safe environment and we are confident that through close collaboration with our partners, we will deliver the projects on time and to owners’ high QHSE standards.”

The above contracts are not expected to have any material impact on the earnings per share and net tangible assets per share of Sembcorp Marine for the year ending December 31, 2012.