Singapore’s Keppel Shipyard says it is continuing to secure contracts from new and existing clients even amid the current downturn in the market driven by low oil prices.
Most recently, Keppel says it has secured a Floating Production Storage and Offloading (FPSO) conversion contract as well as three repair, upgrade and modification contracts worth a total of about $89 million.
The FPSO conversion project Keppel Shipyard will be undertaking is for Armada Madura EPC Limited, a joint venture between long-standing customer Bumi Armada and Shapoorji Pallonji Group. The contract marks Keppel’s third conversion/upgrading project for the joint venture, following the successfu completion of the first two FPSOs, Armade Sterling and Armada Sterling II, which have been commissioned at the two offshore fields in India.
Work on the FPSO conversion, which has already commenced, is scheduled to complete in 3Q 2016. Upon completion, the FPSO will produce for the Madura Strait Block BD which is located 65km east of Surabaya and about 16km south of Madura Island, Indonesia.
Separately, Keppel Shipyard has been awarded major repair, upgrade and modification contracts by Totem Ocean Trailer Express Inc. (Totem Ocean), Dolphin Drilling Limited (Dolphin Drilling) and Saipem Offshore Norway AS (Saipem Offshore). Dolphin Drilling & Totem Ocean are new customers to Keppel Shipyard while Saipem Offshore is a returning customer.
“Despite the headwinds faced by the industry due to the current low oil price environment, Keppel Shipyard continues to receive active enquiries for its wide range of expertise including repair works and Liquefied Natural Gas (LNG) solutions,” said Michael Chia, Managing Director of Marine & Technology at Keppel Offshore and Marine, parent company of Keppel Shipyard. “By leveraging our strong track record in repair, upgrade and modification, as well as expanding on our LNG capabilities which include extensive experience in LNG carrier repairs and Floating Storage Regasification Unit conversions, we are able to continue attracting new customers while maintaining the trust of repeat customers to keep our yards busy.”
Keppel Shipyard’s contract with Totem Ocean is for the world’s first conversion of a large roll-on/roll-off cargo vessel to operate on a dual-fuel diesel LNG propulsion system. Keppel describes the work scope as a complex undertaking, which includes the replacement of four engines, adding 2,200m3 of LNG capacity along with the addition of 47km of new cabling.
When the conversion is completed, the vessel, Midnight Sun, will produce less greenhouse gas emissions, reducing emissions of particulate matter by 91 percent, nitrogen oxides by 100 percent, sulphur oxides by 90 percent and carbon dioxide by 35 percent.
Keppel Shipyard’s work on a drillship belonging Dolphin Drilling, Belford Dolphin, includes renewal survey and modification, while for its project with repeat customer Saipem Offshore, Keppel Shipyard will undertake major refurbishment and upgrading work that include installation of a new 750-tonne Abandon & Recovery winch and additional thruster, as well as living quarters extension for a Field Development Ship.