SMM / Swiber

SMM / Swiber: SMM’s Indonesian subsidiary, PT SMOE Indonesia, in consortium with Swiber’s JV PT Rajawali, has secured a contract worth US$175m from Premier Oil Natuna Sea, for the engineering and construction of 2 Wellhead Platforms, 2 infield sub-sea pipelines and modification works on an existing facility for the Naga and Pelikan Project, offshore Indonesia. Construction is expected to commence Jul ’12 with offshore completion by Sep ’13. SMM’s scope of work, worth US$63m, entails engineering design and construction of the 2 platforms and modification work on the existing Central Processing Platform. This is the second contract award that SMM has secured from Premier. PT Rajawali is responsible for the laying of the 2 sub-sea pipelines and transportation of the 2 platforms. While positive, the contract is small vs SMM’s current net orderbook of $7.4b, and Swiber’s orderbook of ~US$1.2b. SMM trades at 12.8x P/E. Swiber trades at 6.9x P/E.