REG - Harland & Wolff - Contract Win - SeaRose Upgrade

Harland & Wolff groupAnnouncement

20/10/2023 07:00

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RNS Number : 7385Q  Harland & Wolff Group Holdings PLC  20 October 2023

This announcement contains inside information.

 

20 October 2023

 

 

 

Harland & Wolff Group Holdings plc

("Harland & Wolff" or the "Company")

 

£61 million contract award - SeaRose FPSO Mid-Life Upgrade

 

Harland & Wolff Group Holdings plc (AIM: HARL), the UK quoted company
focused on strategic infrastructure projects and physical asset lifecycle
management, is pleased to announce that Cenovus Energy Inc. ("Cenovus") has
awarded the mid-life upgrade contract of the SeaRose Floating Production
Storage and Offloading ("FPSO") vessel to Harland & Wolff (Belfast)
Limited. This contract follows from the Letter of Intent that was previously
announced by the Company on 31 July 2023. Cenovus Energy is an international
integrated oil and natural gas company headquartered in Calgary, Canada, with
a market capitalisation of circa CA$54bn.

 

The base contract value is approximately £61 million. The vessel is expected
to arrive in in the first quarter of 2024 and will be in the Building Dock for
a period of more than three months.

 

A number of pre-arrival works have already commenced, including inspections,
procurement of steel, fabrication of customised blocks and other dry dock
operations. The Company is to commence certain fabrication works in FY 2023 so
that it is fully prepared to commence refurbishment and upgrade works as soon
as the vessel arrives next year. Upon completion of pre-arrival workstreams,
the Company is expected to generate revenues of approximately £10 million in
FY 2023, with the outstanding balance expected to be received in FY 2024. At
its peak, it is estimated that there will be circa 1,000 personnel working on
the vessel including the Company's staff and subcontractors.

 

Revenues from this contract are included within management's revenue
expectations for the Group to achieve in FY2023 and FY2024, being £100m and
£200m respectively.

 

John Wood, CEO of Harland & Wolff Group Holdings plc, comments:

 

"I am delighted that Cenovus has chosen Harland & Wolff as its preferred
yard to undertake the mid-life upgrade of the SeaRose. The vessel first came
into Belfast in 2012 so we will use our existing knowledge of this FSPO, in
addition to applying the latest technologies and innovations for these kinds
of highly specialised projects.

 

This is a significant win within our non-defence portfolio from a global,
blue-chip energy group and I am pleased that we are gaining a reputation as a
go-to yard for large and complex programmes. With an estimated 1,000 personnel
on-site, this project will allow for further synergies in our execution,
leveraging off of personnel, skill sets and supply chains that will support
the upcoming FSS Programme."

 

 

For further information, please visit  www.harland-wolff.com
(http://www.harland-wolff.com/)   or contact:

 

 Harland & Wolff Group Holdings plc                                        +44 (0)20 3900 2122

 John Wood, Chief Executive Officer                                        investor@harland-wolff.com (mailto:investor@harland-wolff.com)

 Arun Raman, Chief Finance Officer                                         media@harland-wolff.com (mailto:media@harland-wolff.com)

 Cavendish Securities plc (Nominated Adviser & Broker)                     +44 (0)20 7397 8900

 Stephen Keys / Callum Davidson / Dan Hodkinson (Corporate Finance)

 Michael Johnson (Sales)

 Liberum Capital Limited (Joint Broker)                                    +44 (0)20 3100 2000

 Nicholas How / Edward Mansfield

 Radnor Capital Partners (Investor Relations)                              +44 (0) 20 3897 1838

 Neville Harris / Joshua Cryer

About Harland & Wolff

Harland & Wolff is a multisite fabrication company, operating in the
maritime and offshore industry through five markets: commercial, cruise and
ferry, defence, energy and renewables and six services: technical services,
fabrication and construction, decommissioning, repair and maintenance,
in-service support and conversion.

 

Its Belfast yard is one of Europe's largest heavy engineering facilities,
with deep water access, two of Europe's largest drydocks, ample quayside and
vast fabrication halls. As a result of the acquisition of Harland & Wolff
(Appledore) in August 2020, the company has been able to capitalise on
opportunities at both ends of the ship-repair and shipbuilding markets where
there will be significant demand.

 

In February 2021, the company acquired the assets of two Scottish-based yards
along the east and west coasts. Now known as Harland & Wolff (Methil) and
Harland & Wolff (Arnish), these facilities will focus on fabrication work
within the renewables, energy and defence sectors.

 

In addition to Harland & Wolff, it owns the Islandmagee gas storage
project, which is expected to provide 25% of the UK's natural gas storage
capacity and to benefit the Northern Irish economy as a whole when completed.

 

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