Lamprell warns strong rig construction backlog may not last

Lamprell has issued an update on its offshore rig/platform construction programs.

Offshore staff

SHARJAH, UAE – Lamprell has issued an update on its offshore rig/platform construction programs.

Recently the fabricator won orders for six newbuild jackups and several smaller awards. In the second half of 2014 it started work on four new jackups, two for Ensco andtwo for Shelf Drilling.

In total, seven newjackups are under construction at the company’s Hamriyah facility. Additionally, 10 refurbishment projects are under way in Hamriyah and Sharjah, all of which are expected to be delivered on time and on budget.

Construction should begin soon oftwo newbuild jackups recently commissioned by NDC.

Last year Lamprell completed its largest rig conversion project to date, theMOS Frontier, and delivered the new Caspian Sea jackup Mercury.

However, the company has noted that some global drillers and IOC’s have announced reductions in their capex programs and it believes this trend will continue. Although Lamprell intends to continue tendering in the short term to meet current demand, its ability to keep winning new business will depend on the industry’s broader health.

The scale of the readjustment will likely remain unclear until the market and the oil price stabilizes, it adds.

Lamprell foresees intense competition ahead with a large number of players chasing fewer projects, leading to increased pressure on margins.

01/12/2015

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