Friday 7 May 2021

John Evans, Chief Executive Officer, said:

In the first quarter of 2021 Subsea 7 delivered solid revenue and EBITDA growth compared with the prior year. Although it was a relatively quiet quarter for announced new orders, the Group’s backlog remains robust at $6.0 billion and tendering activity for oil and gas projects has improved in certain regions of the world, with several contracts expected to be awarded to the industry in the coming months. The  high Renewables backlog adds to our revenue visibility and demonstrates the advantage of a diversified energy services strategy. Looking ahead with optimism to a recovery in new order flow in the oil and gas business as well as continued, strong growth in thr well-established offshore wind business.

Strategy update

Subsea 7’s two-pronged strategy comprised of ‘Subsea Field of the Future’ and ‘Energy Transition – Proactive Participation’ made further progress in the quarter with our first carbon capture and storage award, for the Northern Lights project in Norway, as well as the establishment of a joint venture to develop the Salamander floating offshore wind project in Scotland. These form part of a collection of activities focused on emerging energies that underpin our commitment to enabling lower carbon solutions both for Subsea 7 and clients.

First quarter operational review

In the first quarter the Subsea and Conventional business unit made good progress on several projects. In the Middle East, Seven Champion was active in Saudi Arabia installing topsides at the 3 PDM project at the Hasbah and Arabiyah fields (CRPO 27) as well as the 28 Jackets project at the Marjan, Zuluf, Safaniya and Ribyan fields (CRPO 47, 48 and 49). In Angola, Seven Arctic and Simar Esperança completed the final phase of the Zinia project, while the Sangomar project in Senegal made good progress in the fabrication of pipelines and subsea equipment. In the Gulf of Mexico, Seven Navica and Seven Pegasus were active on the Ichalkil project, while Seven Oceans and Seven Pacific continued offshore activities on the Mad Dog 2 project. Engineering and fabrication activities continued on the Anchor, King’s Quay and Jack St Malo projects. In Australia, Subsea 7’s scope was completed by Seven Eagle at the West Barracouta field while procurement activity commenced on the Barossa project. The diving support and light construction vessels achieved good utilisation in the North Sea.

In the Renewables business unit continued work on the Seagreen project, with fabrication of the jackets and inner-array cables making further progress. In Taiwan, winter weather resulted in Seaway Yudin remaining on standby for most of the quarter. Seaway Aimery and Seaway Moxie were in transit to Europe ahead of their campaigns in the North Sea.

Overall, utilisation of Subsea 7’s active fleet was 66% in the first quarter, compared to 63% in the prior year period. The quarter was marked by a number of international transits of some of our global enablers. In addition, Seven Vega incurred significant downtime while in the Gulf of Mexico for equipment repairs to address storm damage. It returned to operation on 14 April and the delay has largely been accommodated by reallocation of work to Subsea 7’s other pipelay vessels. At the quarter end, the active fleet comprised 29 vessels following the release of Harvey Intervention.

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