EOC SET LATEST AND BIGGEST FPSO

The strategic growth plans of EOC Limited (EOC or the Group), one of Asia's leading providers of offshore construction and production services to the oil and gas (O&G) sector, to strengthen its recurrent income base, are firmly on track as it moves to initiate its largest-ever charter contract, worth up to US$1 billion with all extension options exercised, in 4Q FY11. 

Under the contract secured in 2009, Lewek EMAS - the Group's newest and biggest floating production, storage and offloading (FPSO) vessel - will be chartered to Premier Oil Vietnam Offshore B.V. for up to 12 years. The charter covers a primary term of six years, with six renewable one-year extension options. The client is a unit of the UK-based Premier Oil group, a leading independent exploration and production (E&P) company in the offshore sector. 

Only recently christened at Singapore's Keppel Shipyard on 15 April 2011, the vessel is expected to commence production in the Chim Sao field, off Vietnam in 4Q FY11. Its assignment will include the processing of oil and natural gas liquids as well as water injection. There are also plans to deploy the Lewek EMAS - whose disconnectable turret mooring system makes it highly versatile - to help develop marginal fields around Chim Sao. 

Mr Lim Kwee Keong, EOC's Chief Executive Officer, said: "Winning such a major contract demonstrated the conviction that clients have in EOC's in-house engineering and marine expertise, as well as our project management capability when handling challenging offshore projects. 

Now, the vessel's expected timely delivery will not only boost the Group's operational track record, it also confirms our ability to advance plans for augmenting the fleet with at least one FPSO every 18-24 months. This strategic fleet enhancement programme will allow the Group to capture new opportunities and maximise vessel utilisation as increased offshore E&P activity creates mounting demand for FPSOs, particularly, ones with the capability to successfully take on even the most challenging conditions. 

The Lewek EMAS is EOC's second FPSO to be commissioned since we listed on the Oslo Børs in 2007; our first was delivered in late 2009. We expect this latest vessel to contribute to the Group's recurrent income stream starting from financial year 2011." 

Equipped with state-of-the-art technology, the Lewek EMAS can produce up to 50,000 barrels of oil a day and store up to 680,000 barrels. Its operations and maintenance will be managed by a 50-50 venture owned jointly by EOC and PetroVietnam Transportation Corporation (PVTrans), a maritime transport and service provider in the offshore O&G sector. Under the venture, EOC will share and transfer its knowledge and expertise in operating and managing the Lewek EMAS with PVTrans as they work together to carry out offshore processing of crude oil.  

EOC's first FPSO, the Lewek Arunothai, achieved full production and received acceptance from the client, a publicly listed national petroleum E&P company, in October 2009. It has been a strong revenue contributor to the Group ever since. 

EOC recently reported a net profit of US$6.8 million, after achieving revenue of US$38.6 million, for its second quarter which ended February 2011.  
Source: EOC