Mr Tong Chong Heong, Chief Executive Officer of Keppel O&M, said, "With the strong confidence and support of new and repeat customers, Keppel O&M continues to be the provider of choice for a broad range of offshore and marine projects.
"2013 will be a busy year for us as we continue to focus on the quality execution of all our projects - we are committed to ensure that they are delivered safely, promptly and to high customer satisfaction. We will also enhance our capabilities, and so extend our range of value-added services."
Keppel Singmarine Pte Ltd (Keppel Singmarine) secured two of the three new contracts, with the third new contract won by Keppel Shipyard Ltd (Keppel Shipyard).
One of Keppel Singmarine's two new contracts is from Hydro Marine Services, Inc., a subsidiary of McDermott International, Inc (McDermott), for the construction of a high-specification deepwater pipelay (S-Lay) vessel.
Developed by Keppel's Marine Technology Development (MTD), this vessel is designed to support advanced pipelay operations, in which pipelines are installed to depths of up to 10,000 feet. It is also capable of achieving efficient pipelay rates for long trunklines, operating in severe weather conditions, and providing significant thrust output and power distribution.
Works for the pipelay vessel is scheduled to commence in 1Q 2013 and is expected to complete in approximately two and a half years. This contract will become effective after both parties have fulfilled certain conditions precedent by January 2013.
Keppel Singmarine's other new contract is from Australia-based Bhagwan Marine Pty Ltd (Bhagwan Marine) to build a catamaran air dive support vessel (DSV).
When completed in 1Q 2014, the DSV will be deployed in the north west of Western Australia to support the operations of Apache Energy Ltd. Designed by Incat Crowther Pty. Ltd, the DSV is of twin hull configuration (catamaran).
Specialised units such as pipelay vessels and DSVs form part of Keppel Singmarine's growing track record. Keppel Singmarine has also worked together with Keppel Shipyard to bring to the market Saipem's Castorone, one of the world's largest and most capable pipelay vessels. Presently, Keppel Singmarine's projects include a multi-purpose dive support construction vessel for SBM Offshore N.V. (SBM Offshore).
Keppel Shipyard's new contract is from EMAS Offshore Construction and Production Pte Ltd (EMAS Offshore) to modify and upgrade an existing Floating Production Storage and Offloading (FPSO) facility, Lewek Arunothai. The yard's workscope includes the installation of new structures, piping systems and deck crane, refurbishment of the living quarters as well as the fabrication and installation of the rigid arm and external turret mooring systems.
When completed in 2Q 2013, the FPSO will be deployed as an Early Production System in the Kamelia field, which is located in the Malaysia/Thailand Joint Development Area (JDA) in the North Malay Basin. The upgraded FPSO will be capable of handling 100 million standard cubic feet per day (MMscfd) of gas, 1000 barrels per day (bpd) of condensates and 500bpd of water.
The above contracts are not expected to have any material impact on the net tangible assets and earnings per share of Keppel Corporation Limited for the current financial year.
Createwealth8888's tracking of Kep Corp Order Book
However, market is still worry of margin squeeze.
The next 2-3 quarters will be clearer whether margin really kena squeeze or not?