By Stella Goh

Two contracts worth RM2.06 billion from India’s state-owned oil company Oil and Natural Gas Corporation Ltd (ONGC) has secured by Bumi Armada for works involving the Armada Sterling Floating Production, Storage and Offloading Vessel (FPSO) in Mumbai. The Armada Sterling FPSO will be operated in the ONGC D1 field located 200km off the west coast of Mumbai, India.

One of the two contracts secured by its joint-venture company (JVCo) Armada D1 Pte Ltd (Singapore) is for a bareboat charter lease (BBC Contract) with an estimated total value of US$370 million (approximately RM1.54 billion). Armada F1 is 51% owned by Shapoorji Pallonji Oil & Gas Pte Ltd (SPOGPL), while the remaining 49% is owned by Bumi Armada.

The other contract received by its JVCo Shpoorji Pallonji Armada Oil & Gas Services Pte Ltd (India) (SPAOGSPL) is for operation and maintenance (O&M) and has an estimated total value of INR9.2 billion (approximately RM520 million). SPAOGSPL is 60% owned by SPOGPL, while 40% owned by Bumi Armada’s wholly-owned subsidiary Bumi Armada (Singapore) Pte Ltd.

Both BBC and O&M contracts are for fixed period of 10 years with an annual option to extend for up to five additional years and will effective from 25 September 2020. The company is expected to contribute positively to the company’s future earnings during their tenure.

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