New rig contracts in the UAE worth nearly US$360 million were highlighted in Lamprell’s recently published first half results, despite a 27.2% drop in revenue compared to the first half of 2009.
Lamprell had a total of thirty jackup rigs at its Hamriyah and Sharjah facilities during the first six months of 2010, delivering a revenue of $189.3 million compared to $259.9 million for the same period in 2009.
The company’s CEO, Nigel McCue said: “We have experienced a higher level of rig refurbishment activity through our facilities than in prior periods, although it continues to be at a lower level of average expenditure than previously.”
“Whilst we are experiencing a reduced level of offshore construction activity, mainly in the area of floating production, storage and offloading vessels, we remain confident of the long term future of this market sector,” he added.
In July the company won a $317 million contract from Abu Dhabi’s National Drilling Company for two jackup rigs. Following the award to construct the two LeTourneau S116E jackup drilling rigs, construction activities have commenced on the first rig at the company’s new Hamriyah facility.
This particular rig was previously under construction for Riginvest G.P. and the engineering and procurement elements of this project are therefore well advanced, the company said. The procurement activities associated with the second rig have begun and construction of this unit will commence in the third quarter of 2010.
As part of the contract, NDC has options for Lamprell to build two further jackup rigs for $158.5 million per rig, exercisable over the next 11 months. Each option includes additional optional equipment orders of $12.6 million.
The company also won a $39 million contract from an undisclosed integrated energy provider. The contract is for the construction of an offshore topside structure comprising of a two level utility deck and five level accommodation module for 38 personnel. Lamprell said the project will be constructed to North Sea standards and is scheduled for delivery alongside the Jebel Ali quay in the first quarter of 2012.
In April, Lamprell completed the deepwater drilling rig Offshore Mischief for Texas based Scorpion Offshore.
Lamprell said it is looking into in new business areas such as the refurbishment and construction of semi-submersible drilling rigs and drill ship refurbishment, which will be carried out at its new Hamriyah Free Zone facility.
The company’s oilfield engineering operation is being relocated in the new Hamriyah facility which it expects, will release capacity at its Jebel Ali facility and allow oilfield engineering operations to benefit from the ‘synergies’ between its land rig and jackup rig projects.
Fabrication and refurbishment projects will be transferred to Hamriyah by the end of 2010 and a new workshop will be completed in the second quarter of 2011.
The company is seeking new opportunities in new markets, in particular in Iraq and other Middle East countries in the medium term.
McCue said that the first half has been a busy and successful one for the company during which it won new contracts worth $890 million which included the latest NDC contract.
“Executing our work to the highest standard, both on time and on budget, remains central to our business and we believe is the basis on which we have won recent contracts and added new customers. We completed the Scorpion Offshore Mischief in April 2010, on time and on budget, and this approach is underpinning the future growth of our business,” he said.
“We continue to see a high level of interest for the wide spectrum of new build services we offer and our proposals pipeline remains strong,” concluded McCue.
