Slowdown, Brazil Impact Hit Sembcorp

By Aiswarya Lakshmi
Tuesday, February 16, 2016
Photo: Sembcorp Marine Ltd

 The strain of low oil prices on the offshore and marine sector was in full display as  the world’s second-largest builder of oil rigs Sembcorp Marine Ltd posted its first quarterly loss in at least 12 years.

 
The company took impairment charges and provisions of S$609 million for projects of its client Sete Brasil Participacoes SA and others. It’s the first quarterly loss since the company started reporting data in 2003, according to Sembcorp Marine’s website.
 
Sete Brasil is a private company set up in 2010 to build, own and lease deepwater rigs to state-run oil producer Petrobras. But Sete ran into financing difficulties in 2014, after it was caught up in a corruption scandal involving Petrobras executives, Brazillian politicians and a number of other construction and engineering companies supplying Petrobras.
 
The impact of plummeting prices had rippled across the sizeable oil industry. Oil majors that had engaged costly rigs to drill for oil in remote locations were forced to cut spending and jobs.
 
Sembcorp Marine company also warned that it expects the downtrend to last longer than previous cycles as Singapore's $10 billion rig building industry faces cancellations and a dearth of new orders.
 
Sembcorp Marine warned that the current oil price downcycle is expected to be more protracted than previous cycles, but said that it remains well-positioned to ride out the downturn.
 
“Several of our customers have requested for delivery deferments in light of delays in chartering out their rigs. Given the current depressed environment in the upstream sector, we have tried to accommodate their requests, while preserving our commercial interests,” Sembcorp Marine said. 
 
For the fourth quarter, Sembcorp posted a S$535.2 million ($383 million) attributable loss, excluding non-operating items, compared with a profit S$174 million for the same year ago period.
 
Sembcorp Marine, which competes with Singapore's Keppel Corp Ltd for building jack-up rigs, made a S$278 million provision in the fourth quarter for foreseeable losses on contracts in progress.
 

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter May 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

Kvichak Delivers for the NYPD

Kvichak Marine Industries informs it continues to expand production of its high performance vessel line with delivery of another Response Boat - Medium Commercial   Kvichak,

Damen Delivers Floating Pump Station to Hamburg

Hamburg Port Authority (HPA) has taken delivery of the Sauger III, a custom floating pump station by Damen Shipyards Group for supporting dredging operations. Situated

Mothballed Vessels SE Asia Reflect Oil Slump Pain

Around 1,300 offshore support vessels lying idle worldwide. Not everyone in shipping is bemoaning the industry's worst crisis in living memory: a cluster of

Offshore

EU Ships in Libyan Waters Would Undermine Tripoli Govt

The U.N.-backed government in Libya has not invited European ships into its territorial waters to help stop people smuggling because this could harm efforts to

Mothballed Vessels SE Asia Reflect Oil Slump Pain

Around 1,300 offshore support vessels lying idle worldwide. Not everyone in shipping is bemoaning the industry's worst crisis in living memory: a cluster of

Mermaid Maritime Bags Subsea Contracts, Delays Newbuilding

Thailand’s Mermaid Maritime said it has been awarded a number of subsea contracts in the Middle East with a total worth of $11million.   It has also reached

Workboats

Apply Now for the MN 100

The August 2016 edition of MarineNews, the leading voice in the North American workboat market, will feature 100 leaders and innovators, including workboat owners and operators,

Bay Shipbuilding Delivers ATB to Moran

Fincantieri Marine Group’s Fincantieri Bay Shipbuilding (FBS) has delivered the Articulated Tug Barge unit (ATB) Barbara Carol Ann Moran and the 110,000-barrel

Tech & Design Solutions for Modern Workboats

EPA Tier 4 regulations (for engines of 804 hp and higher) and propulsion advancements have many manufacturers and vessel designers changing course to adapt to new requirements and customer demands.

Marine Equipment

Damen Delivers Floating Pump Station to Hamburg

Hamburg Port Authority (HPA) has taken delivery of the Sauger III, a custom floating pump station by Damen Shipyards Group for supporting dredging operations. Situated

Strategic Marine Building Luxury Crewboat

Strategic Marine announced the kick-off of its first collaboration with PT. Pelayaran Tanjung Kumawa, expecting to deliver an exclusive luxury crewboat in November this year.

Harding Sold to Palfinger

The PALFINGER Group has signed today the acquisition of 100 per cent of the shares in Herkules Harding Holding AS and thus, the globally operating Harding Group.

 
 
Maritime Careers / Shipboard Positions Maritime Security Naval Architecture Navigation Offshore Oil Pipelines Port Authority Salvage Ship Electronics Ship Repair
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1210 sec (8 req/sec)