Malaysia: Nam Cheong Sells 3 AHTS Vessels

Malaysian shipbuilder, Nam Cheong Limited, a specialist in Offshore Support Vessel (“OSV”) segment that focuses on the construction and engineering of complex, sophisticated and environmentally-friendly OSVs, yesterday announced the sale of three Anchor Handling Tug and Supply Vessels.

It has, through its subsidiaries  sold three 5,000 bhp Anchor Handling Towing Supply (“AHTS”) vessels to new customers from Singapore, including a Norwegian-based Singapore company. The total value of the contracts amounted to US$36.8 million  (approximately S$46.3 million).

The customers are emerging offshore support service providers for oil majors in the Asia-Pacific and South America region. The sales mark yet another expansion of Nam Cheong’s customer base.

Two of the vessels will be deployed to South America and one to the Asia-Pacific region. The Norwegian-based Singapore company will own, operate and manage the two vessels deployed to South America under a long-term charter contract with Petrobras, a Brazilian multinational energy corporation that is the eighth biggest company in the world in market value.

The AHTS vessels are being constructed as part of the Group’s build-to-stock series. Scheduled for delivery in the second and third quarters of 2012, each vessel is about 60 metres long and has a minimum bollard pull of 60 tonnes.

One of the AHTS vessels is being built in Nam Cheong’s Miri yard in Sarawak, Malaysia, and the other two are being built in two of the Group’s subcontracted yards in China.

Mr Leong Seng Keat, Nam Cheong’s Executive Director, said: “We are especially glad that we are gaining new customers in Singapore, including a Norwegian-based Singapore company, further widening our global presence as an offshore marine play. The collective sale once again demonstrates the continued demand for smaller AHTS vessels.”

Mr Leong added: “High, resilient oil prices averaging above US$100 per barrel for the past few months has continued to spur oil majors to increase exploration and production spending, allowing Nam Cheong to benefit from the increased in demand for offshore support vessels. In addition, our vessels, which are constructed under the build-to-stock programme, offer significantly lesser lead time between order and delivery and place us in a sweet spot where we will be able to respond swiftly to the hike in demand.”

Based on the number of rig orders globally for 2011, industry experts expect global demand for OSVs to increase by 174 vessels, starting 2012 and into 2013. Exploration and production spending is also expected to increase by 10% in 2013, based on segmental fleet growth analysis.

These contracts are expected to contribute positively to the earnings of the Group for the financial year ending 2012.  The Group’s current order book stands at approximately RM628 million(USD 204.7 million), comprising 12 units of vessels, which are scheduled for delivery stretching till end of 2012.

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Offshore Energy Today Staff, March 30, 2012; Image: Nam Cheong