Malaysia’s THHE has yet to resolve its Layang FPSO woes caused by its liquidity issues.
The engineering and construction company was in June 2014 awarded a contract for the conversion and delivery of the Deep Producer 1 FPSO, to be used for oil production from JX Nippon’s Layang field in Block SK10, offshore Sarawak.
The delivery has been delayed amid THEE’s liquidity woes, and according to reports from Malaysia, the FPSO might now end up in Vietnam, instead in Malaysia.
This is according to Malaysian news website Focus, which last week reported, citing unnamed sources, that Yinson might buy the FPSO and use it for “its Vietnam operations.”
Yinson, also based in Malaysia, describes itself as the world’s sixth largest FPSO operator.
Both Yinson and THHE responded to the article in separate Bursa Malaysia filings saying there, indeed, have been some talks over the FPSO.
THHE said: “The company has long been exploring various ways to partly crystallize its investment in the FPSO Layang project and as part of this initiative, the company is currently still in discussion with JX and Yinson relating to Yinson taking over the company’s FPSO vessel charter from JX Nippon. At the current juncture, the proposal remains in discussion stage.”
Yinson said: “The company is constantly exploring and evaluating business opportunities in its home market which are in line with the Group’s long-term objectives and growth to expand its floating, production, storage and offloading business, including exploring redeployment opportunities for its fleet.
As part of such evaluation, the company is currently still in discussions with JX Nippon and TH Heavy Engineering in connection with the company taking over the FPSO vessel charter for JX Nippon by itself. This opportunity is one of the few Malaysian proposals which the company is currently evaluating. The proposal remains in discussion stage.”
Neither of the two companies confirmed nor denied the Vietnam redeployment option.
Worth noting, Focus last week also reported that Yinson might buy some assets in Sabah from THEE.
Both companies have denied this, with Yinson saying it “has not engaged discussion with any party in relation to purchase of any assets in Sabah,” while THHE said “it has no such assets in Sabah.”