McDermott Unit Gets Trinidad Gig - Analyst Blog

Energy-focused engineering and construction firm McDermott International (MDR) announced that one of its units has received a full engineering, procurement, construction and installation (“EPCI”) of a 750-ton compressor module for U.K’s BG Group’s Hibiscus field development offshore Trinidad.

The deal – valued at more than $50 million – calls for McDermott to provide the full spectrum of engineering and construction services for the Hibiscus gas field, 28 miles off the north coast of Trinidad. This will enable BG to boost gas supply to its Atlantic liquefied natural gas (“LNG”) trains.

The Hibiscus field is part of BG-operated Trinidad & Tobago’s North Coast Marine Area development that delivers gas to trains 2, 3, and 4 of Atlantic LNG in Point Fortin, South Trinidad.

McDermott’s Houston-based facility will be responsible for the detailed engineering design of the compression module as well as the procurement for the module equipment and some specialty items, while its Morgan City fabrication unit will obtain bulk items and construct the module on site in Louisiana.

The Texas-based engineering-to-project management service provider commenced engineering work during the first quarter of 2011, with fabrication scheduled to begin by the first quarter of 2012. Loadout and transportation are likely to be carried out in the first quarter of 2013.

McDermott’s DB50 – a heavy lift vessel – will set the compressor module at the location where installation will be performed on the existing Hibiscus platform, at a water depth of 500 feet. This will be followed by the compressor module tie-in, hook-up and commissioning on site. The project will be included in the company’s order backlog for the second quarter.

McDermott, which currently retains a Zacks #3 Rank (short-term Hold rating), primarily serves the worldwide offshore oil and gas field developments, including front-end design and detailed engineering, fabrication and installation of offshore drilling and production facilities, as well as installation of marine pipelines and subsea production systems.

Additionally, the company provides project management and procurement services. It operates in most major offshore oil and gas producing regions, including the U.S., Mexico, Canada, the Middle East, India, the Caspian Sea and Asia Pacific.

In August 2010, McDermott completed the spin-off of its ‘Power Generation Systems’ and ‘Government Operations’ segments into a separate, independent and publicly traded company The Babcock & Wilcox Co. (BWC).

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