McDermott International has been awarded three separate projects by a major national oil company for the integrated engineering, procurement, construction, and installation (EPCI) services in multiple fields in the Arabian Gulf.
In addition to this, there has also been an award of an additional scope on an existing contract, also being executed in the Arabian Gulf, also known as the Persian Gulf, where McDermott is working for Saudi Aramco.
McDermott said the projects were a substantial brownfield award for the company covering EPCI for jackets and topsides, subsea pipelines and subsea cables. Work is expected to be executed through to Q4 2017.
The new work comes as McDermott posted positive Q1 results. Q1 revenues of were $729 million, up $178.5 million on $550.5 million for the prior-year first quarter. McDermott says the Inpex Ichthys project and work for Saudi Aramco on 12 offshore jackets and the Marjan gas oil separation project drove the increase. McDermott also completed tge PB Literol project for Pemex offshore Mexico, using an advanced float-over method to install the 7657-tonne production deck in the Bay of Campeche - Pemex's first floatover.
The firm's Q1 adjusted net income was $36.5 million, compared to an adjusted net loss of $4.1 million, in the prior-year first quarter.
In Q1, McDermott won work for its new flagship vessel, the DLV 2000, officially named just last month, through the award of the Woodside Greater Western Flank Phase 2 project, as well as a large offshore pipeline-related EPCI project in the Middle East, scheduled to complete this year. The DLV 2000 is due to start operations in Q2 on the Inpex Ichthys project.
During the last quarter, the LTA II Lump Sum project with Saudi Aramco achieved its fabrication start milestone ahead of schedule and the INPEX Ichthys project continues to remain on schedule, says McDermott CEO and president David Dickson.
McDermott also celebrated the opening of its new Asia Area headquarters in Kuala Lumpur, Malaysia.
Dickson said: "The macro environment still remains uncertain, and recently one of our customers, Petrobras, decided to terminate the charter of our Agile vessel. As a result, we have recorded an impairment during the quarter reflecting the lack of opportunities for this vessel in our current revenue pipeline. Despite the current market conditions, we see continued bidding activity in our core markets and a steady level of opportunities in our revenue pipeline.”
For the latest work announced in the Arabian Gulf, engineering is expected to be carried out by McDermott’s specialist teams in Dubai, UAE; and, Chennai, India. Procurement is expected to be performed by McDermott’s specialist teams based in Dubai.
Fabrication of the structures is scheduled to be undertaken by McDermott’s Dubai-based fabrication facilities and marine installation is expected to be under taken by McDermott’s specialist fleet of shallow water vessels.
Revenue from the contract awards will be included in McDermott’s Q2 backlog.
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