McDermott makes progress on Saudi offshore hookup

McDermott’s Middle East segment has returned to profitability, according to the company’s third-quarter statement.

Offshore staff

HOUSTON -- McDermott’s Middle East segment has returned to profitability, according to the company’s third-quarter statement.

During this period, all its projects in the Middle East contributed to gross profit. Last month, the company reached a significant milestone on one project offshore Saudi Arabia and demobilized the major workboats employed for the hookup campaign.

Remaining commissioning is due to be completed next spring.

On one deepwater Malaysian project, however, McDermott experienced vessel mechanical downtime that contributed to $66 million of additional costs. The company reached an agreement with the customer totaling $33 million, partly offsetting the charge, which mitigates weather risk and late delivery penalties.

As a result, McDermott intends to maintain continuous operations through the monsoon season to install critical production-related items. Last month it completed the first of four installation campaigns and the entire program should conclude during the first half of 2014.

11/5/2013

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