CFA Society Singapore
SINGAPORE (Oct 7): Keppel Offshore & Marine’s subsidiary Keppel Singmarine has signed two additional contracts with Stolt-Nielsen Gas BV, a subsidiary of Stolt-Nielsen, to build two additional small-scale LNG carriers worth a total of around $105 million.
Three options were granted to Stolt-Nielsen Gas as part of the original contract signed in May 2017 between Keppel Singmarine and Stolt-Nielsen Gas to build two LNG carriers. The first option lapsed in November 2017, while the second and third options have now been exercised by Stolt-Nielsen Gas.
Similar to its preceding two units, the two LNG carriers will each have a capacity of 7,500 cubic metres, and come equipped with engines that can run on both diesel and LNG. To be completed in 4Q20 and 1Q21 respectively, the carriers will have a class notation for bunkering which enables the provision of LNG bunkering services if required.
With the tightening of global emissions standards, the marine industry is increasingly adopting LNG as a marine fuel. Economical and quick to market, small-scale LNG projects are a means to reaching end users located in remote areas not served by pipelines.
The latest contracts are not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation for the current financial year.
Year to date, shares in Keppel have fallen 5.7% to $7.10.