DAEWOO Shipbuilding & Marine Engineering Co, the world's third largest yard, received a record two trillion won (US$2.1 billion) order to build an offshore oil platform as rising crude prices spur refiners to expand.
The floating production and storage platform will be delivered to a company in Europe by December 26, 2011, the Seoul-based Daewoo Shipbuilding said in a regulatory filing yesterday, without identifying the buyer, Bloomberg News reported. The facility will produce about 200,000 barrels of oil a day in the waters off western Africa.
Oil companies, including Total SA and Exxon Mobil Corp, are spending more money to explore and produce fuel as consumption increases in countries such as China. This is leading to a fifth consecutive year of record orders for yards in South Korea, the world's biggest shipbuilding nation.
"With oil prices at record levels, there'll be more demand for offshore rigs and platforms," said Ohk Hyo Won, an analyst at Hyundai Securities Co in Seoul. "There are only a handful of companies in the world that can take an order of this size and Daewoo Shipbuilding is one of them." She has a "buy" rating for the stock.
The 325 meter long rig will be the biggest of its kind to be built, Daewoo Shipbuilding said. It will be able to store two million barrels of oil.
A company in Asia also placed an order for two cape-sized bulk carriers, the biggest of their type, Daewoo Shipbuilding said. It also expects to win a contract for a drill ship soon. This would bring the total value of the orders the company announced yesterday to US$3 billion. The shipyard did not disclose the name of the buyers or the value of the contracts.
Hyundai Heavy Industries Co, the world's biggest shipyard, in September last year received the largest single order to build offshore oil production facilities worth US$1.6 billion from Abu Dhabi National Co in the United Arab Emirates.