Keppel, Nam Cheong pick up new orders amid oil price slump

SINGAPORE - Locally-listed firms Keppel Corp and Nam Cheong announced new orders today (Dec 29), indicating continued demand for vessels used in oil exploration and production despite the recent sharp drop in crude prices.

Crude oil is currently trading near five-year lows due to a global supply glut, and has almost halved in price from the peak in June. But international benchmark Brent was up 84 cents at US$60.29 in mid-afternoon London trade on Monday, clawing back above the US$60-a-barrel mark on concerns about disruption to output from OPEC member Libya.

Keppel, the world’s largest builder of offshore oil rigs, said Keppel AmFELS - a US-based subsidiary of Keppel Offshore & Marine - won a contract valued at over US$100 million (S$132 million) to build one of the world’s largest land drilling rigs. Keppel did not identify the buyer but said the rig, scheduled for delivery in mid-2016, will be capable of operating in harsh conditions.

Separately, Singapore-listed but Malaysia-based Nam Cheong said it sold two vessels, including a platform supply vessel in deals worth about US$45 million. The buyer of the platform supply vessel is EA Temile Development Company of Nigeria.

Nam Cheong chief executive Leong Seng Keat said: “Despite the recent volatility in global oil prices which has affected investor sentiments across the industry, the securing of these orders from our repeat customers evidently reveals the continued interest in oil and gas activities.” – CHANNEL NEWSASIA