SINGAPORE - Keppel Shipyard, a wholly-owned subsidiary of Keppel Corporation's offshore and marine (O&M) arm, on Wednesday announced that it has secured a repeat contract for a newbuild floating production, storage and offloading (FPSO) vessel worth about US$2.8 billion ($4 billion).
The tender for this contract was from Brazil's national oil company, Petroleo Brasileiro (Petrobras). The contract will see Keppel O&M undertake the engineering, procurement and construction of a P-83 FPSO vessel.
This contract will be on a progressive milestone payment basis, and is scheduled for delivery in the first half of 2027, Keppel said in a press release.
The contract will add approximately $3.8 billion to Keppel O&M's orderbook, bringing the unit's net orderbook to some $11.8 billion as at Sept 28, the highest since 2007. This would put Keppel O&M in a strong position to pursue new business opportunities in areas such as renewables and clean energy solutions, said the group.
The P-83 will be the third FPSO that Keppel O&M is building for Petrobras for the Buzios field. In August this year, Keppel Shipyard also secured a similar contract worth about US$2.9 billion from Petrobras for the engineering, procurement and construction of P-80 FPSO. Keppel O&M is also currently working on the P-78 FPSO which was awarded in May 2021.
When completed, these FPSOs will be among the largest floating production units in the world.
Keppel said the P-83 has a production capacity of 225,000 barrels of oil per day and a storage capacity of two million barrels of oil. The P-83 also has a water injection capacity of 250,000 barrels per day, and can process 12 million cubic metres of gas per day.
As a repeat order, the new P-83 vessel will be identical to the P-80 in terms of specifications and execution methodology, said Keppel. The P-83 will build on the synergies reaped from the P-80, including adapting the design and engineering, as well as leveraging economies of scale in the procurement of materials.
The fabrication of the topside modules will be replicated across Keppel O&M's facilities in Singapore, China and Brazil, while the construction of the hull and accommodation module will be done by CIMC Raffles in China.
The integration of the separate components will be carried out in Singapore, with the final phase of offshore commissioning works undertaken by Keppel O&M when the FPSO arrives at the Buzios field.
Keppel said its O&M arm has delivered a "significant" number of projects for Brazil and Petrobras over the years to support Brazil's energy infrastructure - including FPOs, production platforms, floating storage regasification units, drilling rigs and accommodation vessels.
BrasFELS - Keppel O&M's yard in Angra dos Reis, Brazil - is currently also undertaking integration and fabrication work for two other FPSOs that will operate in the Sepia field and the Buzios field.
Mr Chris Ong, chief executive of Keppel O&M, said: "We are able to draw insights from the first of our newbuild FPSOs, the P-78, which is progressing well and contributing to Keppel O&M's earnings.
"As the P-83 and P-80 are identical units, greater economies of scale and productivity gains can be expected as we are able to further optimise the engineering and construction process, as well as fully leverage technology and the seamless coordination with our partners in the execution."
The new contract is not expected to have a material impact on the net tangible assets or earnings per share of Keppel for the current financial year.
Shares of Keppel closed on Wednesday at $6.76, down 3 per cent, prior to the announcement. THE BUSINESS TIMES
