Keppel O&M, PEMEX to Build New Yard in Mexico

Keppel Offshore & Marine (Keppel O&M) has strengthened its foothold in the offshore and marine industry in Mexico with the signing of an MOU (Memorandum of Understanding) with PEMEX Exploraciony Produccion (PEP) and P.M.I. Norteamérica, S.A. de C.V. (PMI), both subsidiaries of Mexico’s national oil company, Petroleos Mexicanos (PEMEX).

The MOU is to jointly develop, own and operate a yard facility in Mexico, the first phase of which is to support the construction of six KFELS B class jackup drilling rigs for PEP. The MOU was signed today by the General Director of PMI, Dr Jose Manuel Carrera Panizzo, and the Chief Operating Officer and CEO-Designate of Keppel O&M, Mr Chow Yew Yuen at the Ministry of Foreign Affairs in Singapore, and witnessed by Singapore’s Minister for Foreign Affairs and Minister for Law, Mr K. Shanmugam and Mexico’s Secretary for Foreign Affairs, Mr José Antonio Meade Kuribreña.

Earlier this year, PEMEX unveiled investment plans of US$25.3 billion for 2013, of which US$20 billion will be targeted at upstream activities.

PMI and Keppel O&M intend to establish a joint venture company (PMI-KOM JVC) to be the principal investment vehicle through which both parties would cooperate in various business opportunities that may be agreed upon. The first opportunity identified is the establishment of the yard to service the offshore oil & gas industry in Mexico.

To be located strategically in the modern Port of Altamira along the coast of the Gulf of Mexico, the proposed yard will help to further develop Mexico’s offshore hydrocarbon potential, meeting both the growing needs of the local oil & gas industry and the international clientele operating in the Gulf.

Keppel O&M will leverage its proven expertise and operational track record in the management of the yard which will be able to service PEMEX’s requirements in the offshore and marine construction and service sector, as well as independently pursue work from the private sector. To be developed in phases, the first phase will be to equip the yard to undertake certain portions of the work scope in the construction of six Keppel-designed KFELS B class jackup drilling rigs for PEP.

The total yard development cost will be around US$400 million, with the first phase estimated at about US$150 million.

Subsequent phases of the yard development would enable it to take in deep-draft semisubmersibles and drillships for repairs, undertake FPSO and Floating Liquefied Natural Gas (FLNG) vessel conversions, as well as fabricate topside modules and other offshore structures.

When all the phases are completed, the yard is expected to create up to 4,000 new direct jobs for the local community.

[mappress]
Press release,October 4, 2013