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Bumi Armada in FPSO joint venture with Indian firm

Bumi Armada in FPSO joint venture with Indian firm
Bucking the trend of negativity in the oil and gas space, Bumi Armada has formed a joint venture company with India's Shapoorji Pallonji Oil and Gas Private Limited (SPOG) to develop prospects in the FPSO space, the company said in a stock market announcement.

The company, known as Shapoorji Pallonji Bumi Armada Godavari Private Limited (SPBAG), was formed on 19 July 2016 in India.

"The jv arrangement is for the purpose of combining the capabilities and expertise of Bumi Armada and SPOG in the bidding and if successful, the contracting of the design, fabrication, installation, charter, deployment, and operations and maintenance of a FPSO facility," it said.

SPBAG will be the entity used by the joint venture partners to bid for FPSO projects.

Financial details have not been worked out yet, Bumi Armada said, however, in the event SPBAG is awarded an FPSO project, the parties intend to formalise the jv arrangement through a shareholders agreement

A further announcement will be made at appropriate time when there are further updates and details to the jv, Bumi Armada noted.

SPBAG is 49% less 1 share held by Bumi Armada and 51% plus 1 share held by SPOG. The intended principal activity of SPBAG is in the contracting of the design, fabrication, installation charter, deployment, operations and maintenance of an FPSO facility.  

Bumi Armada explained that the jv arrangement will enable the group to expand and carry out its FPSO business, as well as mitigate its financial and project execution risk exposure in respect of any FPSO project awarded, by leveraging on Bumi Armada and SPCL’s strong history and experience in fabrication and construction related activities. 

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