MMA Offshore finding West African market challengingCompany News // October 19, 2016
MMA Offshore says the offshore oil and gas vessel services market continues to be under pressure from a utilisation and rate perspective. "This is impacting MMA and its peers across the industry and across the different oil and gas regions," said the company.
MMA said the first quarter of the 2017 financial year was broadly in line with expectations in the company's Australian, Southeast Asian and Middle East operations. However, the West African market is extremely challenging at present, so MMA has taken the decision to move some vessels out of this region to the Middle East and SoutheEast Asia. This has resulted in lower than expected earnings in this region over that period and substantial redeployment costs.
The two newbuild vessels, MMA Prestige and MMA Pinnacle, are nearly complete. MMA Prestige is currently being set up as a Dive Support Vessel with a saturation dive spread and ROV capability. MMA Pinnacle has the crane to fit, which will be completed in November 2016.
On this basis, the company does not expect any substantial earnings from these vessels in the first half of the 2017 financial year when compared to original expectations. MMA has also sold the Jaya Installer 10, an accommodation barge, which is positive from a cash perspective but also impacts first half earnings.
"The market for the company's services is extremely difficult to predict, however on the basis of the above, MMA expects that full year operating EBITDA will now be in the order of approximately US$20-25 million. On a positive note, the company has managed to firm up the forward order book with some term work and anticipates the second half of the 2017 financial year to be stronger than the first half as the new vessels start working and contributing to earnings."