Offshore staff

SINGAPORE -- Cosco Corp. (Singapore) Ltd.'s 51%-owned Cosco Shipyard Group has secured an engineering, procurement, and construction (EPC) contract, and five semisubmersible heavy lift vessel (HLV) conversion contracts totaling $195.3 million.

Cosco Nantong Shipyard, a subsidiary of CSG, secured the EPC contract from Belgium's, Exmar NV, to build an accommodation barge valued at $38.2 million. The new barge will be ABS (American Bureau of Shipping) class with offshore standards and accommodations for 360. It will be deployed off the western African coast. Under the agreement, Exmar has secured the option for one additional barge.

Construction of the accommodation barge will begin immediately at Cosco Nantong shipyard and is scheduled for delivery in 3Q 2008.

CSG was also awarded five conversion projects from Norway's Front Line, to convert five suezmax tankers into five semisubmersible HLVs. These conversion contracts, totaling $157.1 million, will be undertaken at Cosco's Zhoushan, Guangzhou, and Nantong shipyards. Each project will take 3-6 months to complete. The semisubmersible HLVs are targeted for progressive deliveries before October 2008.

"These semisubmersible HLV conversion projects are high-yielding and can be quickly turned around," says Ji Hai Sheng, vice chairman and president of the company and vice chairman of Cosco Shipyard Group.

"These projects, therefore, provide good returns within a relatively short time. The EPC contract is another valuable addition to our bulging marine engineering order book which showcases our strong capabilities in a wide range of marine engineering work. Going forward, we are confident of improving our profit margins as the Group gain further experience in offshore engineering projects and improve on our operational efficiency."

5/11/2007