Saipem nabs $1.3bn contract to build offshore Gulf pipeline
Loss-making Saipem landed the billion-dollar contract to build four offshore pipelines in the Middle East
Loss-making Italian contractor Saipem has won a $1.3bn engineering and construction contract to build four offshore pipelines in the Middle East.
Milan-based Saipem secured the $1.3bn contract, but did not say who the client was, which country the project will be based in, or when it would start or end.
Saipem did say that its contract covers engineering, procurement, construction, and installation (EPCI) of two 32-inch export pipelines, two 24-inch corrosion-resistant alloy intra-field pipelines, risers, spool pieces, and subsea structures, including onshore and offshore brownfield modifications.
The award also includes the substitution of an old contract for a new one for “substantial” corrosion-resistant alloy pipelines, the contractor said.
Saipem could not be reached to comment at the time of writing.
The win comes just months after the Italian construction company posted a narrowed loss of $2.4m for Q1 2018, a marked improved on the $331m loss reported in the previous quarter.
Subsequently, Saipem’s shareholders voted to use capital reserves and retained earnings to cover a massive $593m loss from 2017.
Big losses forced shareholders to react with a string of measures to provide financial assistance.
In addition to using reserves of capital and retaining earnings, the company’s share premium reserve will be used to plug the cash hole.
Shareholders also approved a buy-back scheme for up to 8.8 million treasury shares, with a maximum value of $46m.
Oil and gas contractor Saipem is currently operational in numerous GCC countries, including Saudi Arabia, Kuwait, and Oman.