Mr Renato Duque, Services Director, Petrobras SA

Mr Lim Chee Onn, Executive Chairman of Keppel Corporation,

1.                  I am very happy to join all of you here today at the sail-away ceremony for Petrobras P-52, one of the world’s largest semi-submersible production platforms.  First let me congratulate Petrobras and Keppel FELS on this major milestone in their business partnership. I understand that this lower hull of P-52, the part of the project performed in Singapore, has been completed on time and within budget.  I was also told that the Singapore scope of the P-51 project, the sister vessel of P-52, has just left Keppel FELS yard for Brazil, and it was also on time and within budget.  My congratulations to both Petrobras and Keppel FELS for these significant achievements. 

2.                  Keppel FELS was one of the first Singapore companies to invest in Brazil.  Today, Keppel’s projects account for one third of Petrobras’ offshore production.  By 2008, when all the current orders are completed, Keppel’s projects will account for more than half of Petrobras’ total offshore crude production of about 2.2 million barrels daily.   

Offshore and Marine Engineering (OME) Sector

3.                  The Offshore and Marine Engineering (OME) sector is a significant contributor to the maritime industry in Singapore, accounting for about S$2.1 billion^[1] in value-add in 2004.  The transport engineering sector, which includes the offshore and marine engineering sector, has enjoyed a growth of 33.2% in the first nine months of this year[2].  Contracts clinched in the offshore sector accounted for a majority of this growth.

4.                  Like all other businesses, this industry has seen its fair share of business cycles in the last 30 years.  I am indeed happy that the resilience of the companies and the workers in this sector has enabled them to innovate during the down cycles, and be ready for the market upturn when it comes.  As a result, the industry has managed to recover strongly during this business upturn.

5.                  This is well reflected in the performance of the two key Singapore companies in this sector. Currently, the Keppel and Sembawang groups have secured more than 80% of the jack-up rig orders world-wide.  Both groups have also secured more than 50% of the semi-submersible drilling rigs orders globally.  From Jan to Nov 2005, both groups have clinched a total of more than $10 billion worth of orders for building offshore rigs. 

6.                  Apart from direct contributions in forex earnings and job creation, the industry has tremendous spin-offs for other economic sectors. As an example, our logistics and transport businesses get a big boost from the materials and equipment that have to be shipped or airfreighted into the country.

R&D in the OME Sector

7.                  The opportunities for development and growth in the offshore and marine businesses are tremendous.  With demand for energy all over the world increasing steadily, offshore exploration for oil and gas will continue to be an important activity in the years ahead.

8.                  We should therefore build on the success of our companies in this area to make Singapore an offshore and marine engineering centre.  But we cannot take our pre-eminence for granted. To remain ahead of the competition that will inevitably appear, we will need to deepen and broaden our expertise and technological know-how, and thereby enhancing our productivity and competitiveness.  This is why we have identified maritime R&D as one of the key driving forces for the continuing growth of the maritime industry in Singapore.  To this end, MPA will continue to work with the industry, the EDB, A*STAR and our tertiary and research institutes to help promote more R&D in the offshore and marine engineering sector. 

9.                  With that, let me end by wishing the management of Keppel and Petrobas continuing success in the years ahead and may Petrobras P-52 propel you to even greater heights. 

1 Based on preliminary statistic provided by the Economic Development Board

2 Source: Economic Development Board