MMA Offshore has bagged a $50 million contract from Woodside Petroleum, but the marine services provider has warned shareholders that tough market conditions show no signs of abating.

The Woodside contract generates some much-needed good news for the company to round out a difficult 2015.

The Woodside integrated fleet contract will see MMA provide three vessels to support Woodside’s offshore Northwest Shelf, Pluto and AusOil production assets in Australia’s North West region.

The three vessels to be chartered under the contract include two of MMA’s purpose built offtake support vessels and a modern, high specification platform supply vessel.

MMA said the contract for the three vessels was for a “firm period” plus a number of options. Should all options be exercised, the contract value would increase to about $110 million in total.

MMA managing director Jeff Weber said the significance of the contract in the current competitive market cannot be overstated.

“There is enormous pressure on the offshore marine industry to achieve sustainable cost positions without compromising quality operations,” he said.

“The award of this Contract is an endorsement of our ability to support world class operators in this challenging economic time and to provide cost effective solutions.”

In the same announcement, MMA acknowledged that the offshore oil and gas vessel market remained under significant pressure due to low oil prices and substantially reduced demand for services across all sectors of the market.

“As a result, the first four months of trading were lower than expected with market conditions unlikely to improve through FY2016,” the company said.

The company continues to generate positive operating cash flow, but expects to deliver EBITDA in the region of A$75-85 million for the full year “with a low level of visibility of demand for the second half of the financial year.”

MMA is currently supplying services to Technip for Chevron’s Wheatstone project with the current scope expected to complete by January 2016.

In addition, Gorgon related activity continues to decline and the accommodation vessel Silja Europa will complete its contract at the end of this year which will impact second half earnings.

“There is tender activity in the market, however rates are under significant pressure as competition for the work and margin pressure is intense,” MMA said.

The news sent MMA’s shares tumbling in trade Nov. 10, closing the day’s session 20.5 per cent lower to 29 cents.

The company’s shares have been on the decline since the beginning of the year as the ongoing low oil price reduces demand for its services. MMA’s 2015 trading peak was in January when shares reached $1.25.