Petrofac sells JSD6000 project to ZPMC

RNS Number : 8893L

Petrofac Limited

24 April 2018

 

Press Release

24 April 2018

PETROFAC SELLS JSD6000 PROJECT TO ZPMC

Petrofac Limited ("Petrofac" or "the Company") announces that Petrofac International (UAE) LLC has signed an agreement to sell the JSD6000 project to Shanghai Zhenhua Heavy Industries Co Ltd (ZPMC).

The transaction comprises the sale of all JSD6000 related assets held by Petrofac, including the owner furnished equipment, for a gross consideration of US$190 million and a 10% interest in a new special purpose vehicle set up to own the vessel once commissioned. Petrofac will provide technical support for the construction of the vessel, which is expected to complete in 2022⁽²⁾. Petrofac will not contribute to the cost of construction, commissioning or testing of the vessel.

The total consideration of US$190 million is offset by a net amount of US$23 million retained by Petrofac under the previous hull and marine contract with ZPMC. The remaining US$167 million net cash consideration will be received as follows: US$92 million within 20 business days; a further US$70 million in stages as assets are physically transferred (expected to be over the period mid-2018 to early 2019); and, a final amount of US$5 million upon commissioning of the vessel. The proceeds from the sale will be used to reduce gross debt.

Petrofac's Group Chief Executive Ayman Asfari said: "This agreement materially completes our disposal of the project, in line with our stated intention to exit the deep-water market. It is a further positive step in the execution of our stated strategy to focus on our core strengths, deliver organic growth and reduce capital intensity."

Ends

Notes:

1.   The assets being disposed were classified as assets held for sale at 31 December 2017 and had a carrying amount of US$217 million There are no profits attributable to the assets that are the subject of the transaction.

2.   Petrofac will provide technical support for a period of four and a half years to support the construction of the vessel. Petrofac will not contribute to the cost of construction, commissioning or testing of the vessel. Petrofac will retain its 10% interest in the special purpose vehicle, which will own the vessel irrespective of the final cost of the vessel.

3.   A small impairment and fair value adjustment is expected to be taken in the six-month period ended 30 June 2018.

For further information contact:

Petrofac Limited      

[phone]

Jonathan Low, Head of Investor Relations

[e-mail]

Alison Flynn, Group Head of Communications

[e-mail] 

[phone]

Tulchan Communications Group

[phone]

[e-mail]

Martin Robinson

LEI 2138004624W8CKCSJ177

This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation which came into effect on 3 July 2016. 

NOTES TO EDITORS

Petrofac

Petrofac is a leading international service provider to the oil and gas production and processing industry, with a diverse client portfolio including many of the world's leading integrated, independent and national oil and gas companies. Petrofac is quoted on the London Stock Exchange (symbol: PFC).

Petrofac designs and builds oil and gas facilities; operates, maintains and manages facilities and trains personnel; enhances production; and, where it can leverage its service capability, develops and co-invests in upstream and infrastructure projects. Petrofac's range of services meets its clients' needs across the full life cycle of oil and gas assets.

With around 12,500 employees, Petrofac operates out of seven strategically located operational centres, in Aberdeen, Sharjah, Abu Dhabi, Woking, Chennai, Mumbai and Kuala Lumpur and has a further 24 offices worldwide.

For additional information, please refer to the Petrofac website at www.petrofac.com

 

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