Wednesday, July 19, 2000

Singapore company confirms it's shopping
for a U.S. yard
Singapore Technologies Engineering is trying to acquire a shipyard in the U.S. and is willing to pay U.S. $60-U.S.$180 million, according to CEO Boon Swan Foo. He was speaking after the company announced a 36% gain in first-half net profit and said it expects full-year growth to be more than 25 per cent . ST Engineering's earnings for the six months to June 30 soared to Singapore $132.2 million on an 18 per cent rise in turnover to S$1.1 billion.U.S. operations contributed about 17 per cent to first-half revenue

ST Engineering has been widely reported as among the potential buyers for the Kværner Phladelphia shipyard

ST Engineering's Singapore yard has four shipbuilding berths for vessels of up to 30,000 dwt, floating docks for vessels up to 75,000 tonnes dwt and a Syncrolift system for vessels of up to 12,500 dwt. Its product range include a 1,018 TEU series of containerships that are the largest containerships to be built in Singapore.

LR warns tanker owners of Paris MOU crackdown
In its latest Classification News . Lloyd's Register advises owners of the Paris MOU's intention to initiate a targeted inspection campaign on tankers greater than 3,000 gt and 15 years of age during the period September 1 - November 30 this year. There are currently just over 1,700 crude and product tankers worldwide that fall within this specified category.

LR details some of the expected inspection criteria for this campaign, and urges all owners to invite an LR surveyor to attend during initial port state control inspections, so that any problems may be solved as early as possible, thereby minimizing potential delays and cost to owners or operators. You can access the information by clicking here.

H&W problems will impact Fred Olsen Energy profits
Northern Ireland's Harland and Wolff , which is 70.8% indirectly owned by Fred Olsen Energy, has previously announced lay-offs as a result of its uncertain order situation after delivery of two drillships to Global Marine. As of June30 , H& W had provided termination notices to 325 of its 1,585 employees, 253 of whom had already left the company by the end of June. Redundancy costs related to these terminations will be included in the second quarter accounts.

During the second quarter, the yard primarily worked on the delivery and final commissioning of the two drill-ships. The first ship was delivered on 16 March. The second ship is scheduled for delivery by the end of the third quarter. The completion phase results in under-utilization of parts of the workforce, and some departments have not operated at full capacity throughout the second quarter. This reduced activity has in addition resulted in under-recovery of overhead costs.

These factors, says Fred Olsen Energy, will in total result in a net loss of approximately £8 million in the second quarter. This will again be reflected in the consolidated accounts of Fred Olsen Energy

Earnings in Fred Olsen Energy's drilling division will be influenced by the classification required periodic survey conducted on the Byford Dolphin for 37 days of the second quarter. The rig is now back in operation for Statoil. The company's remaining fleet of semi-submersibles and floating production units have, with the exception of Borgen Dolphin been fully employed throughout the period.

How Aker Maritime will pay for that chunk of Kværner
Aker Maritime has responded to an inquiry from the Oslo Stock Exchange concerning the financing of its NOK 2.6 billion purchase of shares and subscription rights in Kværner last week .

To meet the first parts of the settlement, to a value of around NOK 650 million, Aker Maritime says it is drawing on its liquidity reserves and bills. Payment for subscription rights amounts to NOK 165 million of this and has already been made. The rest of the amount is due in a week.

The largest single chunk of shares in Kværner is to be purchased from Bergesen d.y. for just over NOK 1 billion. As Bergesen has already stated, this transaction will be concluded by October 12 at the latest.

"The remaining share purchases announced last week ," says Aker Maritime, "are bridge financed through a variable strike option program. The options will be exercised on December 22 at the latest, but can be called by Aker Maritime at any given time prior to this. The shares subscribed in Kværner's ongoing share issue will be bridge financed in a similar manner."

Aker Maritime says these arrangements provide it with "the financial flexibility and time to secure an optimal long-term financing of the acquired shares in Kværner."

Aker Maritime says its financial situation is good. At the end of the first quarter the group's equity ratio was 29.8%. On completion of debt financing of the share purchase, the equity ratio is estimated at 22%.

Shell orders two LNG carriers from MHI
Shell International Gas Ltd has ordered two Liquefied Natural Gas (LNG) carriers from the Mitsubishi Heavy Industries (MHI) shipyard in Japan. The two vessels have been secured against the background of a growing portfolio of Shell LNG projects around the world which require shipping, and will help meet growing demand for liquefied natural gas.

Shell describes the new vessels asan important step in realizing its plans to develop new markets for LNG.

The order maintains a long term relationship between the Royal Dutch/Shell group of companies and the Mitsubishi Group. Each of the carriers will have a capacity of 135,000 cubic metres and will utilise the Moss containment system. They will be delivered in third quarter 2002 and first quarter 2003.

Dick de Jong, Director of Shell Gas & Power's Global Business, said: "The ships - along with Shell's time chartered LNG vessel, the Galeomma which is currently on short term charter to Coral USA and Oman LNG - will provide Shell's Gas and Power Business with shipping capacity to support its Global LNG strategy. This involves development of a portfolio of LNG projects, including new markets in India, the Americas , and the Mediterranean, as well as the associated supply projects that Shell is involved with worldwide."

In particular the ships can assist in the start up of our Hazira LNG Terminal Project in Gujarat, North West India while long term shipping requirements are resolved, and in supply to the Cove Point LNG terminal, where we recently secured capacity. Mitsubishi Heavy Industries were able to provide the best available package, which included early delivery to allow us to ensure timely supply to our customers."

The vessels, will be manned and operated by Shell International Trading & Shipping Co. Ltd, as is the Galeomma, thus taking advantage of STASCO's unmatched experience in LNG shipping. Shell has over 300 officers qualified to serve in senior positions on LNG ships.

Shell's Vice President Shipping, Jan Kopernicki said: "STASCO has applied its extensive expertise to LNG vessel construction and operation to the design of the two LNG vessels to be built by MHI. Following completion, the vessels will provide a valuable addition to the LNG fleet managed by STASCO."

The vessels will have the following dimensions and characteristics :

Length overall - about 290 meters
Length between perpendiculars - 276 meters
breadth molded - 46 meters
depth molded - 25.5 meters
scantling draft molded - 12 meters
design draft molded - 11 meters
deadweight on design draft - about 67,300 metric tons
capacity of LNG 135,000 cubic meters at 98.8% cargo tank filling ratio and at tank temperature of -163 degrees Celsius
main propulsion plant
Marine steam turbine
SHP metric (at MCR) 21,320 kW
containment system Moss


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