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SembCorp rides strong demand tide



By Upstream staff 

Singapore's SembCorp Marine issued an upbeat outlook today after its quarterly profit more than tripled, thanks to robust demand for oil rigs and ship conversions.

SembMarine, 62%-owned by conglomerate SembCorp Industries, said today the rig-building business remained strong, with high charter rates, near 100% use and an ageing global fleet working in its favour.

"Overall, the market outlook for all sectors in the offshore and marine industry remains strong. The group will continue to benefit from further growth in these sectors," it said.

Offshore oil exploration has picked up with oil prices hitting record highs last year, leading to stronger demand for deep-water, high-technology drilling rigs and for the conversion of oil tankers into floating production, storage and offloading vessels.

The surge in orders has lifted profits at SembMarine and its bigger rival, Keppel Corporation.

Together the two Singapore companies, with their shipyards spread across the world from China to the US, are building about 60% of all offshore rigs under construction worldwide with delivery dates stretching out into 2010.

SembMarine's net profit increased to S$95.3 million ($62.2 million) in October to December, from S$30.3 million in the year-ago quarter. It earned a full-year 2006 net profit of S$238.4 million, versus S$121.4 million in 2005.

SembMarine said its total outstanding order book stood at S$7.1 billion as of 15 February this year.

SembMarine's major customers include Norway's Sinvest, Awilco Offshore, Petrojack, and Seadrill, Reuters reported.


Thursday, 15 February, 2007, 11:33 GMT  | last updated: Thursday, 15 February, 2007, 11:33 GMT

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