Singapore’s Vallianz said on Monday it signed $458mn contracts with an unnamed National Oil Company in the Middle East.
The deals were signed to extend the contract duration for 19 of Vallianz’s offshore support vessels (OSV) currently deployed to the NOC which the company described as “one of the world’s largest”.
The company currently has 15 anchor handling tug supply vessels and 4 platform supply vessels supporting the offshore oil and gas operations of the NOC.
Under the agreement, the vessels will continue to be deployed to the company’s offshore fields until June 2018, with an option to extend for two more years until June 2020.
CEO of Vallianz, Ling Yong Wah said, “Being cognisant of the current market situation in the offshore oil and gas industry, we took a proactive approach and engaged our NOC customer to review the Group’s existing vessel charters.
“In addition to upholding the quality of our services and the trust our customers have in us, it is paramount that the Group exercises flexibility to align our services to prevailing market conditions.
“We believe the new contracts show that our customer values our approach and remains confident of our ability to deliver quality services.
“While charter rates for our vessels in the new contracts have been revised lower by about 10 percent on average, the adjustment is less than the rate cuts seen in the offshore marine industry.
“More importantly, it has enabled the Group to lengthen the charter duration for half of our fleet of owned vessels to year 2020 including options. This further strengthens our relationship with the customer, and also reflects our focus on maintaining a resilient business model for the Group to ride through business cycles.”
Vallianz presently owns a fleet of 39 vessels operating in the Middle East, Asia Pacific and Latin American markets. In addition, the Group has a 49 percent-owned associate company, PT Vallianz Offshore Maritim, which operates another 20 vessels in the cabotage-protected market in Indonesia.
In December 2014, Vallianz was awarded a $97mn order to supply a customised Offshore Floating Storage and Supply Vessel to the NOC for up to 5 years.
Earlier this month, the company secured another deal worth up to $300mn to supply two self-elevating platforms for up to 7 years.
Ling said, “With the new contracts secured in July this year, our current order book has been boosted to nearly $1bn, which is a record level in our corporate history and marks a new milestone for the Group.
“It also reflects the Group’s ability to overcome the prevailing industry headwinds. Our order book comprises mainly of long term charters that now stretch up to 2022, thereby improving visibility and stability of the Group’s future revenue streams.”
