Sembcorp Marine’s (SembMarine) wholly-owned subsidiary, Keppel FELS, has received the arbitral award against Awilco Rig 1, a wholly-owned subsidiary of Awilco Drilling. The award was made in favour of Keppel FELS.
The arbitration commenced in June 2022. Awilco had failed to make an instalment payment when due under a contract for the construction of a mid-water semisubmersible drilling rig for harsh environment use.
The contract was worth about US$425 million ($567.0 million). Keppel FELS had issued a notice of termination in June 2022 to Awilco for such default in payment.
The rig was transferred to Asset Co as part of the transaction prior to the merger between SembMarine and Keppel Offshore & Marine (Keppel O&M).
The outcome of the arbitration is not expected to have any material impact on SembMarine’s net tangible assets (NTA) or earnings per share (EPS) in FY2023.
Shares in SembMarine closed flat at 12.3 cents on April 21.
