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THHE to complete FPSO Layang despite winding up petitions

THHE to complete FPSO Layang despite winding up petitions
TH Heavy Engineering's (THHE) headline FPSO Layang project, which was supposed to help turn the company around, could end up being its albatross as it dodges winding up petitions served on it related to the project while insisting the company is still a going concern.

THHE is working closely with relevant stakeholders in ensuring the completion and delivery of the floating production, storage and offloading (FPSO) Layang project, the company said in a statement.

“At this juncture, TH Heavy is still operational and has sought legal advice with a view to striking out or defeating the winding-up petitions. Therefore, it is premature to speculate on the outcome of these initiatives as claimed by certain quarters on social media,” THHE said.

Separate suppliers last week served THHE with three winding-up petitions in relation to the supply of equipment and work done at the FPSO Layang project. TH Heavy had said at the time that it was seeking legal advice on the matters with a view of defeating the petitions, adding that the winding-up petitions would not have any additional financial or operational impact on the company other than the amounts claimed.

The FPSO Layang project involves converting the Laurita, a partly-converted FPSO vessel, into the Deep Producer 1 FPSO which will then be leased to JX Nippon Oil & Gas of Japan for deployment at the Layang oil and gas field off Sarawak for an initial seven years with an additional 10 one-year extensions.

This fixed-term contract is worth $372m and potentially up to $457m if the options are exercised for the full 10 years.

It is hoped the project will turn around THHE, which has been posting losses since mid-2014.