McDermott International announced that it has entered into an agreement with certain of its secured lenders. The scope will be performed by McDermott’s fabrication facility in Batam, Indonesia. McDermott’s Lummus Technology is the master licensor of multiple licensed units. The company will have access to up to $1.7 billion of additional financing, including letter of credit capacity. Company awarded for FEED design competition by POSCO INTERNATIONAL Corporation. Company recently received unsolicited approaches for Lummus Technology with valuation exceeding $2.5 billion.
Under the terms of the agreement, McDermott will have immediate access to $650 million of financing. It includes fabrication engineering, procurement, construction and pre-commissioning scope for three modules. Project team maintained continuous focus on safety and quality. It comprised of $550 million under a term loan facility and $100 million under a letter of credit facility. FEED scope includes development of a PDH plant to be constructed in U.S. Gulf Coast. McDermott to provide EPCI of Wellhead Production Deck Module.
David Dickson, president and CEO of McDermott says “This new credit agreement is a continued signal from our lenders that they support McDermott”.
It reduce for related transaction fees and expenses. The awards follow the completion of a front-end engineering and design (FEED) competition. The plant utilizes Chevron Lummus Global ISODEWAXING and ISOFINISHING technologies. The company expects to utilize the funds to finance working capital. The scope includes license, basic engineering package, extended basic engineering, training, technical services. The award builds on McDermott’s work on earlier phases of the Shwe gas field development. It builds on past work for Yamal LNG in fabricating large process modules.
It support the issuance of required performance guarantees on new projects. The development of the facility will support future growth of propylene in the U.S. McDermott selected due to its strength in engineering. The award will be reflected in McDermott’s third quarter 2019 backlog. The scope includes subsea umbilicals, risers and flowlines (URF) and subsea production systems (SPS) solutions. The award includes technology licensing, basic engineering and technical services. Company announced that it was awarded a sizeable front-end engineering design (FEED).
It continue to make great strides on the Freeport LNG project. McDermott will assist in the development of a PDH plant to be constructed on the U.S. Gulf Coast. The agreement provides near-term liquidity for the company to manage working capital. The Offshore installation of the URF and SPS equipment will commence in 2020 and be completed in 2023. It provide performance guarantees on expected new awards. Company announced it has been awarded a large contract by Saudi Aramco. The award includes a joint URF and SPS EPCI solution, comprising a new subsea well.
It remain focused on serving customer’s needs, supporting dedicated employees. It maintaining valued relationships with subcontractors, suppliers. McDermott is pleased to be working with PetroLogistics II in the development of a facility. McDermott and BHGE will lead the project from the joint Project Management and Engineering office in Perth. McDermott’s joint venture with Chevron, has been awarded a sizeable license. Other business counterparties, all as part of our efforts to enhance our position as a premier. The Haldia unit will be designed to primarily produce premium API Group III base oils.
It fully integrated provider of technology, engineering and construction solutions to the energy industry. The award recognizes QMW’s experience and excellent performance in the Arctic on an earlier Yamal LNG project. It will pull from vast expertise in engineering to complete the FEED. CLG’s lubricants technologies provide worldwide licensees with vast commercial experience. BHGE will deliver the SPS scope, including vertical christmas trees. McDermott continues to pursue the previously announced strategic alternatives process for Lummus Technology.
McDermott’s Lummus Technology will provide licensing and engineering services for its olefins technology. McDermott has decided to terminate its previously announced sale process for its industrial storage tank business. The scope of work includes EPCI of Wellhead PDM for four wells, 3.75 miles. The award follows an earlier award granted to BHGE in 1Q 2019. The contract was signed in the second quarter of 2019. The company’s ability to access the remaining amount of financing under the agreement. Lummus has a reputation for innovation and reliability in the market.
“The growth strategy and ability to achieve a long-term balance sheet solution”, David Dickson said.
The shale revolution has resulted in a significant decline in co-product propylene production. The field development will be carried out using state-of-the-art assets. McDermott’s Lummus Technology is a leading licensor of proprietary petrochemicals, refining, gasification. The conditions are detailed in the Form 8-K that the company filed with the U.S. It is further evidence that QMW is a tier one module fabricator in the LNG market. McDermott was selected due to its strength in engineering and extensive knowledge. McDermott also announced that it is withdrawing its previously stated guidance for full-year 2019.
Separately, the presentation material used by the company in discussions with the lenders. The award was reflected in McDermott’s second quarter 2019 backlog. Kirkland & Ellis LLP is serving as legal counsel to McDermott in connection with the new financing and related matters. McDermott’s alliance with BHGE is a combination of two leaders in subsea development. Evercore is serving as financial advisor and AP Services, LLC. The scope includes the fabrication of three Pre-Assembled Unit Complex Process Modules. The Shwe field is approximately 44 miles (70 kilometers) offshore Myanmar. Barclays is acting as lead arranger on the financing.