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Daewoo Shipbuilding About to Sign New Offshore Plant Contract

Daewoo Shipbuilding

Daewoo Shipbuilding & Marine Engineering (DSME) is expected to sign a new contract with Norwegian oil company Statoil. Estimated to have a total value of 650 billion won (US$580 million).

According to industry sources, Daewoo Shipbuilding & Marine Engineering (DSME) is expected to sign a new contract with Norwegian oil company Statoil. Estimated to have a total value of 650 billion won (US$580 million), the contract is to build the hull and living quarter of a floating production, storage and offloading (FPSO) facility. The other two participants in the tender are Hyundai Heavy Industries and Samsung Heavy Industries.

The construction of the facility is estimated to take US$1.5 billion in total. The bidding process has been divided into those for the hull and living quarter and the topside. The preferred bidder for the former is scheduled to be selected early next month before that for the latter is selected in the first half of next year. After the facility is built, it is used in the Johan Castberg Development Project. The oil field in the North Sea is estimated to have 450 million to 650 million barrels of oil.

Daewoo Shipbuilding suggested a price of US$575 million. Hyundai and Samsung suggested approximately US$600 million and US$595 million, respectively.

DSME has signed no new offshore plant construction contract for three years. Its latest offshore plant construction contract was signed in October 2014 with Tengizchevroil. At the end of September this year, Daewoo Shipbuilding  had an order backlog of 98 units worth US$25.6 billion, more than 20% down from a year ago.
The Otiginal Posted by Jung Min-hee/Business Korea

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