Yinson bags FPSO contracts worth US$901.8m in Nigeria

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KUALA LUMPUR (Feb 28): Yinson Holdings Bhd has bagged contracts worth US$901.79 million (RM3.67 billion) for the charter, operations and maintenance of a floating production storage and offloading (FPSO) vessel by First Exploration & Petroleum Development Company Ltd (First E&P) for use at the Anyala & Madu fields in Nigeria.

The contracts were entered into via its wholly-owned subsidiary Yinson Nepeta Production Ltd (YNPL) and indirect subsidiary Yinson Operations & Production West Africa Ltd (YOPWAL).

YNPL is the FPSO chartering company while YOPWAL is the company engaged in the operations and maintenance (O&M) of the FPSO.

In a statement today, the group said the contract value of US$901.79 million, assuming the extension options are fully exercised, comprises the Bareboat Charter Contract (US$617.09 million) and the O&M contract (US$284.70 million).

Operations are expected to commence at the fields by the fourth quarter of 2019, it added.

Yinson group chief executive officer Lim Chern Yuan said the group would be redeploying one of its existing vessels, FPSO Allan, to Anyala & Madu, and the vessel would be renamed FPSO Abigail-Joseph.

FPSO Allan ceased operations on Jan 31, after a tenure of nearly 10 years at the Olowi Field in Gabon.

"The redeployment of FPSO Allan is a strategic decision that has enabled us to bring forward the project schedule at the same time delivering a more cost-effective solution for our client," said Lim.

"Our engineering and technical teams have been working with First E&P on the Front-End Engineering Design of this project (for) many months, and we are confident that we will meet the expectations of our project partners and local authorities in supporting the development of the Nigerian oil and gas industry," he added.

FPSO Abigail-Joseph will be Yinson's second vessel to operate in Nigerian waters, with the first being FPSO Adoon, which is currently operating in Block OML 123.

Lim said the project is expected to contribute positively to the group's earnings for the financial year ending Jan 31, 2020 onwards until the expiry or termination of the contracts.

Yinson's share price closed 15 sen or 3.33% lower to RM4.35, for a market value of RM4.76 billion.