Keppel building $600m vessel for US energy company

Keppel Corp yesterday said it is building a wind turbine installation vessel for US energy company Dominion Energy that is scheduled for delivery in 2023.

This comes after the conglomerate in October announced that it had bagged a contract worth about $600 million for the engineering, procurement and construction of a vessel for the offshore renewable energy industry.

The vessel is being built by Keppel Offshore & Marine's shipyard in the United States, Keppel AmFels.

It will be available for charter hire to offshore wind developers, in support of several US wind projects, Keppel Corp said.

In addition, the vessel is expected to be fully utilised on US East Coast projects exceeding 5 gigawatts of offshore wind construction, up to the end of 2027.

Its hull will be about 144m long, 56m wide and 11.6m deep, making it one of the biggest offshore wind installation vessels in the world, Keppel Corp said.

It will also have accommodation space for up to 119 people.

Mr Robert Blue, Dominion Energy's president and chief executive, touted the project as a monumental step for the offshore and wind industry in the US.

He said the vessel will provide "significant American jobs and a reliable, home-grown installation solution with the capacity to handle the next generation of large-scale, highly efficient turbine technologies".

Work on the vessel, which will be named Charybdis, has begun with a keel-laying ceremony.

According to Keppel Corp, the contract is on progressive payment terms and is not expected to have any material impact on its net tangible assets and earnings per share for the current financial year.

Separately, the conglomerate on Wednesday night announced that additional bond holders have acceded to the lock-up agreement related to the proposed restructuring of its associate company, Floatel.

Earlier this month, Fels Offshore - a wholly owned unit of Keppel Corp - entered into a lock-up agreement for the proposed restructuring.

Floatel is 49.92 per cent-owned by Fels Offshore. The agreement includes an ad hoc group of holders of US$400 million (S$530 million) worth of Floatel's 9 per cent senior secured first lien (1L) bonds, as well as other consenting 1L bond holders.

The lock-up agreement will commit Floatel, Keppel Corp, the ad hoc group and any acceding 1L bond holders or holders of the US$75 million worth of Floatel's 12.75 per cent second lien bonds to attempt a financial and corporate restructuring of Floatel.

THE BUSINESS TIMES

A version of this article appeared in the print edition of The Straits Times on December 18, 2020, with the headline 'Keppel building $600m vessel for US energy company'. Print Edition | Subscribe