Dutch shipbuilder nets US$103M profit in six months

Aug 05, 2022 News

Backed by Guyana contracts…

– says order book increases to new record level of US$31B

By Kiana Wilburg

Kaieteur News – SBM Offshore, the Dutch shipbuilder of Guyana’s oil vessels, disclosed on Thursday that it earned a handsome net profit totalling US$103M or US$0.58 per share, for the first half of 2022.

The Liza Destiny FPSO that was built by SBM Offshore

This is significant since for the corresponding period last year, the company made US$61M or US$0.32 per share. Of particular interest to the company is the fact that its order book has increased to “a new record level” of US$31.1B. The company said its growth in this regard is backed by the contractual arrangement in place for Guyana’s floating, production, storage and offloading (FPSO) vessel called One Guyana. This ship is expected to serve ExxonMobil’s Yellowtail Project in the Stabroek Block.

In its latest financial statements, SBM said it expects to deliver around US$9 billion net cash flow from its Lease and Operate programmes for the remainder of the year which gives a unique visibility on cash flow for the next 28 years. The company said its teams continue to deliver solid results, despite the challenging environment, adding that it is thrilled about the bottom line projections for 2022.

On the overall project portfolio, SBM said strategic mitigating measures against inflation have been proving effective on controlling cost and protecting schedule on. Nevertheless, the company said parts of the portfolio remain sensitive to the pressure in the global supply chain and impact from COVID-19 pandemic.

Kaieteur News understands that the company’s market outlook for new FPSOs remains positive as the world requires energy which is not only sustainable, but also affordable and reliable. It said this is what the company is delivering through its competitive Fast4Ward® FPSOs which are also characterized by low emissions intensity. The company said it has therefore ordered its seventh Fast4Ward® MPF hull. Expounding on the Lease and Operate Division, SBM said it continues to deliver good results. SBM said as well that the Liza Unity (FPSO) has been successfully ramped up in industry-leading time, meanwhile the compression system for Liza Destiny (FPSO) was successfully upgraded. It said Brazil’s FPSO, the Cidade de Anchieta, is progressing towards a safe restart.

To achieve its goal of net-zero by 2050, the Dutch firm said it has established the following intermediate targets: by 2030, a target net-zero scope 1 and 2 emissions; a 50% reduction in scope 3 greenhouse gas intensity; and zero routine flaring in its fleet. The company also reported seeing good progress under its emissionZERO® programme which aims to have a near-zero emissions FPSO available to the market by 2025.

In respect to new energies and services, the company said it is developing products and services compatible with its net-zero roadmap. It was keen to note that the orderly transition from fossil to renewable energy will require companies to design and develop innovative solutions combined with the capability to reliably execute, finance and operate them.

At the same time, SBM said the transition will require maintaining discipline in providing value to all stakeholders with a particular focus on profitability and appropriate risk allocation. As an energy transition company, SBM categorically stated that it is well positioned to support, make a difference and benefit from multiple pathways in the growing energy transition market.

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