Mermaid clinches Ichthys contract

Mermaid Marine Australia has won a contract, worth up to $500 million, to provide support services to Inpex’s Ichthys liquefied natural gas project.

Under the contract, Mermaid will operate two platform supply vessels (PSVs), which will support the Ichthys offshore facilities located in the Browse Basin off the Kimberley coast, for a five-year period.

The contract is valued at $160 million, however the agreement may be extended for a further two, five-year periods.

Should all options be exercised, the total value of the contract at today’s exchange rate is $500 million, the company said.

The PSVs will be built in Asia to Inpex’s specifications and delivered in Mermaid in late 2015 and early 2016.

They will be operated by Australian crews and supply goods to the offshore Ichthys project from Darwin and Broome.

The contract adds to Mermaid’s strategy of operating PSVs.

“This contract is a major step forward for MMA,” managing director Jeff Weber said.

“Production support contracts such as these are critical to our ongoing success in Australia and we look forward to delivering a safe and successful outcome for Inpex.”

Mermaid announced last month that it would acquire Singapore-based Jaya Holdings’ subsidiaries Offshore Support Services and Offshore Engineering Services for $550 million.

Mermaid, which recorded a half-year net profit of $24.2 million, said it expected to fund the acquisitions with a $317 million equity raising and a $217 million debt facility from existing financiers National Australia Bank and ANZ Banking Group.

The company is offering institutional and retail investors the opportunity to purchase seven new shares for every 18 Mermaid shares at $2.40/share.

Mermaid shares were today trading around $2.38/share.