Houston-based McDermott received its largest single award in the history of its Middle East operations today (27 August) by Saudi Aramco for brownfield work off Saudi Arabia.
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Signing the LTA. Image from McDermott. |
The package of various engineering, procurement, construction and installation (EPCI) projects make up a lump sum award, and follows the signing of a second long term agreement (LTA) between McDermott and Saudi Aramco for EPCI opportunities in several fields offshore Saudi Arabia.
McDermott will carry out the work on this LTA through 2Q 2018. Revenue from the fixed-price award will be included in McDermott’s 3Q 2015 backlog.
During the execution of the projects under the fixed price contract, McDermott plans to maximize in-Kingdom execution activities with a significant portion of the engineering and fabrication scope expected to be carried out by its engineering office in Al Khobar and fabrication facility in Dammam, respectively, the company said.
McDermott expects additional services to be provided by its engineering teams in Dubai, United Arab Emirates and Chennai, India; procurement to be managed by its global procurement office based in Dubai; and vessels from the its global fleet, including specialized shallow water installation vessels, are scheduled to undertake offshore installation.
“Our detailed knowledge and understanding of Saudi Aramco’s objectives, as well as our proven excellence in the Kingdom and the region continue to set us apart. Delivering on strong project execution and integrating McDermott’s local knowledge are critical to future success as we execute these and other projects for Saudi Aramco,” David Dickson, McDermott president and CEO said.
Last month, McDermott announced it was one of Saudi Aramco’s winners of a global competition for the LTA brownfield work. Currently, McDermott is working under an existing LTA with Saudi Aramco, which has been in place since 28 June 2007.
In the company’s 2Q 2015 results, a reported increase in profits was reported at US$11.5 million, up from a net loss of $7.4 million in the same period last year on revenues of $1.05 billion (up $570 million). McDermott attributed revenues from the period from the INPEX Ichthys project, Brunei Shell Petroleum project and three Middle East projects.
In addition to the LTA, McDermott was also awarded a large brownfield contract by Saudi Aramco for the full EPCI scope of 12 jackets for various offshore oil and gas fields in Saudi Arabian waters.
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