Shell Terminates Sapura Energy Contract on Pipeline Rejuvenation Project
10.13.2023 By Tank Terminals - NEWS

October 13, 2023 [Upstream]- UK supermajor Shell has terminated a key engineering, procurement, construction and installation contract it previously awarded to Malaysian contractor Sapura Energy for the second phase of Singapore’s single-buoy mooring pipeline rejuvenation project.


Sapura said in a filing to Malaysia’s stock exchange Bursa this week that the termination came after its wholly owned subsidiary Sapura Offshore Sdn Bhd (SOSB) received a letter dated 20 September from a Shell subsidiary and a meeting of the companies on 5 October.

“Following thereon, without admission of liability and reserving all of SOSB’s rights, the contract is considered terminated by Shell,” SOSB said.

Meanwhile, Sapura Energy said SOSB had sought advice from external counsel and will continue to do so.

The contract was initially awarded in 2020 and Sapura earlier this year said that it was negotiating the rescoping of its EPCI contract for the second phase of Shell’s pipeline rejuvenation project.

The work comprises the repair of a nearshore pipeline and single-buoy mooring system at Shell’s Bukom refinery in Singapore.

If warranted, the existing pipeline might be removed to ensure the crude offloading system is fit for purpose, Sapura earlier said.

This contract had been expected to be completed by the end of December 2023.


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