SSP Offshore has entered into a Letter of Intent with a Chinese shipyard that it says gives it a much improved chance of finding an end user for its circular design floating production facility.
The company’s Asian affiliate, SSP Asia Pte Ltd. (“SSP Asia”), entered into the LOI in December with the Jiangsu Yangzijiang Offshore Engineering Co. Ltd. Under the agreement, Yangzijiang Offshore will begin detailed design and construction engineering for the construction of the first ever SSP unit.
Yangzijiang Offshore is a 78%-owned indirect subsidiary of Yangzijiang Shipbuilding Holdings Ltd., a publicly traded company listed on the Singapore and Taiwan Stock Exchanges that owns and operates one of the largest private shipyard groups in China.
The Yangzijiang Group recently invested heavily in upgrading its construction facilities in the Shanghai region, and is now prioritising an expansion into the fabrication of offshore infrastructure. The group also recently completed the acquisition of a controlling interest in an established naval architecture firm and in an established production process engineering firm, which have offshore oil and gas industry experience.
Yangzijiang Offshore has committed to complete the detailed design and construction engineering for the SSP unit, as well as committing to start early stage construction of the facility upon completion of the construction engineering.
In exchange for the investment being made by Yangzijiang Offshore on behalf of SSP, SSP says it has granted certain exclusivity rights for the platform construction to Yangzijiang.
As a result of the support of Yangzijiang Offshore under the LOI, SSP continued, the schedule for construction and delivery of the first unit once an end-user contract has been secured will be significantly compressed. “Management believes that the ability to offer an expedited delivery schedule on SSP units will be of significant benefit in its marketing efforts, and that having access to the resources of a reputable shipyard with established processes, an experienced workforce and superior yard infrastructure will be of significant value in the ongoing
SSP commercialization efforts”, it added.
SSP Chief Executive Officer, Paul Illingworth, said: “The significant investment being made by the Yangzijiang Group under this agreement demonstrates the belief that this world class shipbuilding group places on the SSP technology and its commercial potential. We are excited to have Yangzijiang Offshore as a key execution partner.”
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