J. Ray McDermott Signs Joint Venture Agreement to Establish New Fabrication Facility in China
June 16 2008 - 6:31PM
Business Wire
McDermott International, Inc. (NYSE:MDR) ("McDermott" or the
"Company"), announced today that a subsidiary of J. Ray McDermott,
S.A. has entered into a joint venture with a subsidiary of
state-owned China Shipbuilding Industry Corporation ("CSIC"). The
joint venture company, Qingdao McDermott Wuchuan Offshore
Engineering Company Ltd. ("McDermott Wuchuan"), plans to establish
a new facility on over 111 acres in HaiXiWan, Qingdao, Shandong,
China. This new facility is anticipated to be strategically located
adjacent to two new CSIC shipyards: Qingdao Wuchuan Heavy Industry
Co. Ltd. (J. Ray's joint venture partner) and Qingdao Beihai
Shipbuilding Heavy Industry Co. Ltd. In this developing area, CSIC
has one floating dock and five dry docks capable of accommodating
vessels up to 500,000 deadweight tons. McDermott Wuchuan
anticipates focusing its business on floating, production, storage,
off-loading ("FPSO") vessel construction and integration. "FPSOs
represent one of the fastest growing offshore construction segments
in our industry today," said Bob Deason, J. Ray's President and
Chief Executive Officer. "China already commands a significant
share of this market and has developed a proven project track
record. Establishing this new joint venture focusing on FPSO's will
add a critical component to J. Ray's comprehensive business
strategy." McDermott Wuchuan is planned to complement each
partner's respective strengths. J. Ray's integrated engineering,
procurement, construction and installation ("EPCI") capabilities
and more than 60 years of international market experience will
bring to the partnership consistency of methods, standards and
procedures, and continuity of mature accredited project management
systems, with a superior safety culture. CSIC brings a solid
reputation as a leading shipbuilder, with extensive market
penetration, an ability to obtain hulls and access to a large,
skilled workforce. McDermott Wuchuan will offer solid, competitive,
integrated engineering and construction solutions to the FPSO
market worldwide. McDermott Wuchuan's new facility is initially
expected to permit annual throughput of up to 33,000 tons,
expending approximately six million man-hours, per year. The
facility will include structural and pipe shops, blasting and
painting facilities, module assembly buildings, covered warehousing
and lay down areas. McDermott is an engineering and construction
company, with specialty manufacturing and service capabilities,
focused on energy infrastructure. McDermott's customers are
predominantly utilities and other power generators, major and
national oil companies, and the United States Government. With its
global operations, McDermott operates in over 20 countries with
more than 20,000 employees, and can be found on the internet at
www.mcdermott.com. In accordance with the Safe Harbor provisions of
the Private Securities Litigation Reform Act of 1995, McDermott
International, Inc., cautions that statements in this press release
which are forward-looking and which provide other than historical
information, involve risks and uncertainties that may impact actual
results. The forward-looking statements in this press release
include statements regarding the formation, focus and expected
throughput of McDermott Wuchuan's operations. Although McDermott's
management believes that the expectations reflected in those
forward-looking statements are reasonable, McDermott 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 uncertainties and risks, including, but
not limited to, adverse changes in the FPSO or other markets in
which McDermott Wuchuan expects to operate, management's inability
to commence operations, and execute plans and objectives for the
expected operations. 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 report
on Form 10-K for the year ended December 31, 2007. McDermott
International, Inc. (NYSE:MDR) (�McDermott� or the �Company�),
announced today that a subsidiary of J. Ray McDermott, S.A. has
entered into a joint venture with a subsidiary of state-owned China
Shipbuilding Industry Corporation (�CSIC�). The joint venture
company, Qingdao McDermott Wuchuan Offshore Engineering Company
Ltd. (�McDermott Wuchuan�), plans to establish a new facility on
over 111 acres in HaiXiWan, Qingdao, Shandong, China. This new
facility is anticipated to be strategically located adjacent to two
new CSIC shipyards: Qingdao Wuchuan Heavy Industry Co. Ltd. (J.
Ray�s joint venture partner) and Qingdao Beihai Shipbuilding Heavy
Industry Co. Ltd. In this developing area, CSIC has one floating
dock and five dry docks capable of accommodating vessels up to
500,000 deadweight tons. McDermott Wuchuan anticipates focusing its
business on floating, production, storage, off-loading (�FPSO�)
vessel construction and integration. �FPSOs represent one of the
fastest growing offshore construction segments in our industry
today,� said Bob Deason, J. Ray�s President and Chief Executive
Officer. �China already commands a significant share of this market
and has developed a proven project track record. Establishing this
new joint venture focusing on FPSO�s will add a critical component
to J. Ray�s comprehensive business strategy.� McDermott Wuchuan is
planned to complement each partner�s respective strengths. J. Ray�s
integrated engineering, procurement, construction and installation
(�EPCI�) capabilities and more than 60 years of international
market experience will bring to the partnership consistency of
methods, standards and procedures, and continuity of mature
accredited project management systems, with a superior safety
culture. CSIC brings a solid reputation as a leading shipbuilder,
with extensive market penetration, an ability to obtain hulls and
access to a large, skilled workforce. McDermott Wuchuan will offer
solid, competitive, integrated engineering and construction
solutions to the FPSO market worldwide. McDermott Wuchuan�s new
facility is initially expected to permit annual throughput of up to
33,000 tons, expending approximately six million man-hours, per
year. The facility will include structural and pipe shops, blasting
and painting facilities, module assembly buildings, covered
warehousing and lay down areas. McDermott is an engineering and
construction company, with specialty manufacturing and service
capabilities, focused on energy infrastructure. McDermott�s
customers are predominantly utilities and other power generators,
major and national oil companies, and the United States Government.
With its global operations, McDermott operates in over 20 countries
with more than 20,000 employees, and can be found on the internet
at www.mcdermott.com. In accordance with the Safe Harbor provisions
of the Private Securities Litigation Reform Act of 1995, McDermott
International, Inc., cautions that statements in this press release
which are forward-looking and which provide other than historical
information, involve risks and uncertainties that may impact actual
results. The forward-looking statements in this press release
include statements regarding the formation, focus and expected
throughput of McDermott Wuchuan�s operations. Although McDermott's
management believes that the expectations reflected in those
forward-looking statements are reasonable, McDermott 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 uncertainties and risks, including, but
not limited to, adverse changes in the FPSO or other markets in
which McDermott Wuchuan expects to operate, management�s inability
to commence operations, and execute plans and objectives for the
expected operations. 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 report
on Form 10-K for the year ended December 31, 2007.
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