SINGAPORE - Keppel Offshore & Marine (Keppel O&M), through its wholly owned subsidiary, Fels Offshore, has signed a management services agreement with Titan Petrochemicals Group - a company in which commodities trading conglomerate Guangdong Zhenrong Energy is a major shareholder - and Titan Quanzhou Shipyard (TQS), to manage the TQS shipyard.
TQS, located in Quanzhou in Fujian province, is one of the largest shipyards in China, occupying a total area of 110 ha with 3,600 metres length of coastline.
When completed, TQS will have four ultra-large and wide dry docks, including one of the largest modern-designed docks in China, which will enable it to convert double hull vessels such as floating production storage and offloading units.
Besides ship repair and conversion capabilities, the yard is also able to construct offshore rigs including jack-ups and semisubmersibles.
Under the agreement which is for a 30-year period, renewable thereafter as mutually agreed, the yard, managed by Keppel O&M, will undertake projects using Keppel's proprietary designs.
TQS is wholly-owned by Titan Petrochemicals, which is a provider of logistics, transportation, distribution and marine services for petrochemical products in Asia.
The agreement is conditional on the completion of the on-going financial restructuring of Titan Petrochemicals and the resumption of the trading of its shares on the Hong Kong Stock Exchange.
Keppel and Titan Petrochemicals are optimistic about the growth potential of China's offshore and marine industry.
China's dependence on oil and gas imports has increased from 43 per cent to 56 per cent in 2012, and is expected to exceed beyond 60 per cent in the next few years.
With its oil production on land having reached a plateau of 200 million tonnes annually, China is looking to expand its offshore oil and gas production to meet rising energy demands domestically, Keppel Corp said in a statement.
Keppel O&M is a subsidiary of mainboard-listed Keppel Corp.