McDermott Awarded Subsea Umbilical and Flowline Installation Contract by Shell for Great White Frio Development
HOUSTON, Nov. 27, 2018 /PRNewswire/ — McDermott International, Inc. (NYSE: MDR) announced today a sizeable* contract from Shell Exploration and Production Company, a subsidiary of Royal Dutch Shell plc, for new subsea umbilical and flowline installation at the Great White Frio development in Alaminos Canyon Block 857 in the U.S. Gulf of Mexico.
McDermott’s scope of work includes project management and engineering; installation of a flexible flowline from the well to a pipeline end termination; installation of one 2,000-foot-long steel flying lead; and installation of two electrical flying leads (EFLs) in a water depth of 8,000 feet. Project management and engineering are scheduled to be performed in Houston, Texas, with offshore installation by McDermott targeted for completion in mid-2019.
“This award demonstrates McDermott’s commitment to helping Shell safely and competitively deliver Great White – their next-generation deep-water energy project,” said Richard Heo, McDermott’s Senior Vice President for North, Central and South America. “McDermott’s proven track record of project execution in the Gulf of Mexico with Shell, combined with our industry-leading subsea capabilities and integrated business model, will help drive efficiency while maintaining our uncompromising commitment to safety and quality.”
The Great White development, which is operated by Shell Offshore Inc. (Shell), is a pioneer deep-water oil and gas project that has unlocked a new frontier of energy development in the Gulf of Mexico’s Lower Tertiary Paleogene. The Shell-operated Perdido Regional Host production hub, which saw first commercial production in 2011, processes oil and gas from the Silvertip, Great White and Tobago fields. The Perdido Host is one of the most prolific oil and gas producing projects in the Gulf of Mexico and has the capacity to handle 100,000 barrels of oil and 200 million cubic feet of gas daily. Shell is focused on safely and competitively growing production from the Perdido Area by optimizing the performance of existing wells and through targeted additional in-field and near-field development opportunities.
The contract award will be reflected in McDermott’s fourth quarter 2018 backlog.
* McDermott defines a sizeable contract between USD $1 million and USD $50 million.
McDermott is a premier, fully integrated provider of technology, engineering and construction solutions to the energy industry. For more than a century, customers have trusted McDermott to design and build end-to-end infrastructure and technology solutions to transport and transform oil and gas into the products the world needs today. Our proprietary technologies, integrated expertise and comprehensive solutions deliver certainty, innovation and added value to energy projects around the world. Customers rely on McDermott to deliver certainty to the most complex projects, from concept to commissioning. It is called the “One McDermott Way.” Operating in over 54 countries, McDermott’s locally focused and globally-integrated resources include approximately 40,000 employees, a diversified fleet of specialty marine construction vessels and fabrication facilities around the world. As used in this press release, McDermott includes McDermott International, Inc. and its subsidiaries and affiliates. To learn more, visit www.mcdermott.com.
In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, McDermott cautions that statements in this press release which are forward-looking, and provide other than historical information, involve risks, contingencies and uncertainties that may impact McDermott’s actual results of operations. These forward-looking statements include, among other things, statements about backlog, to the extent backlog may be viewed as an indicator of future revenues or profitability, and statements about the expected scope, execution and timing of the project discussed in this press release. Although we believe that the expectations reflected in those forward-looking statements are reasonable, we can give no assurance that those expectations will prove to have been correct. Those statements are made by using various underlying assumptions and are subject to numerous risks, contingencies and uncertainties, including, among others: adverse changes in the markets in which we operate or credit markets, our inability to successfully execute on contracts in backlog, changes in project design or schedules, the availability of qualified personnel, changes in the terms, scope or timing of contracts, contract cancellations, change orders and other modifications and actions by our customers and other business counterparties, changes in industry norms and adverse outcomes in legal or other dispute resolution proceedings. If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see McDermott’s annual and quarterly filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2017 and subsequent quarterly reports on Form 10-Q. This press release reflects management’s views as of the date hereof. Except to the extent required by applicable law, McDermott undertakes no obligation to update or revise any forward-looking statement.
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