SembMarine bags $229m Teekay Offshore ship deal

Subsidiaries of Sembcorp Marine (SembMarine) and Teekay Offshore Partners have signed a US$166 million (S$229 million) agreement for the modification of a floating production storage and offloading ship.

The work on the Teekay vessel will be completed in July 2020, SembMarine told the Singapore Exchange yesterday.

The work includes overhauling the internal turret and power generation and repairing the hull, tanks and various systems.

SembMarine expects a positive contribution to its earnings from the contract, but does not expect it to have any material impact on the group's net tangible assets and earnings per share for the year ending Dec 31.

On completion, the ship will be operated by privately owned Alpha Petroleum Resources and deployed in the North Sea.

The agreement is conditional on Alpha Petroleum Resources meeting certain conditions that include finalising its debt facilities and obtaining approval for its development plan for the Cheviot field.

SembMarine expects a positive contribution to its earnings from the contract, but does not expect it to have any material impact on the group's net tangible assets and earnings per share for the year ending Dec 31.

Its shares closed down 0.5 per cent to $1.85 yesterday.

A version of this article appeared in the print edition of The Straits Times on October 23, 2018, with the headline 'SembMarine bags $229m Teekay Offshore ship deal'. Print Edition | Subscribe