Gulf Marine Services Regulatory News (GMS)

Gulf Marine Services PLC

("Gulf Marine Services", "GMS", "the Company" or "the Group")

GMS SCIROCCO CONSTRUCTION COMPLETED ON SCHEDULE AND

FIRST CONTRACT AWARDED

Gulf Marine Services (LSE:GMS), the leading provider of advanced self-propelled self-elevating support vessels (SESVs) serving the offshore oil, gas and renewable energy sectors, is pleased to announce that the newly-built GMS Scirocco has been completed ahead of schedule and under budget and has been awarded its first contract. The vessel will commence a four-month contract (three months firm with a one-month option) in October for an engineering, procurement and construction contractor working for a MENA-based national oil company, with day rates in line with those previously indicated for the region.

GMS Scirocco is the second of a new SESV design, the Mid-Size Class, to be added to the Group's fleet and a third, GMS Sharqi, will be delivered in Q1 2016. A further Large Class, GMS Evolution, will join the fleet in Q4 2016.

GMS constructs its SESVs, also known as jackup barges, at its quayside facility in Abu Dhabi. The current new build programme, which commenced in 2014, will increase the fleet from nine to 15 vessels by the end of next year.

The Group's existing vessels are all currently employed on contracts to support brownfield oil and gas production, well services and maintenance work in the MENA region, and oil, gas and renewable energy-related operations in North West Europe.

Duncan Anderson, Chief Executive Officer of GMS, said: 

"GMS Scirocco is our fourth new build SESV to be completed since Q3 2014 and we are very pleased that this latest addition to the fleet, like those before it, will proceed directly to its first charter following delivery. Demand for our vessels remains strong and is testament to our ability to invest capital to successfully grow our fleet and generate strong returns for shareholders.

"We are looking forward to introducing another two SESVs to the fleet next year. We are already seeing interest in this new tonnage from clients who understand the cost-effectiveness and operational efficiency we offer as both builders and operators, with the flexibility of our offshore support solutions particularly helpful in the current low oil price environment."

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Notes to Editors:

Gulf Marine Services PLC, a company listed on the London Stock Exchange, was founded in Abu Dhabi in 1977 and has become one of the leading providers of self-propelled self-elevating support vessels (SESVs) in the world. The fleet serves the oil, gas and renewable energy industries from its offices in the United Arab Emirates, Saudi Arabia and the United Kingdom. The Group's assets are capable of serving clients' requirements across the globe, including the Middle East, South East Asia, West Africa and Europe.

GMS has an ongoing new build programme which will increase the fleet size by 66% to 15 vessels during the period 2014 to the end of 2016, in response to continued strong customer demand and an anticipated growing market in the foreseeable future.

The Group's SESV fleet, which currently comprises 13 vessels including GMS Scirocco is technically advanced and amongst the youngest in the industry, with an average age of eight years. 

The SESVs are four-legged vessels that move independently, with no requirement for anchor handling or tug support. They have a large deck space, crane capacity and accommodation facilities that can be adapted to the requirements of the Group's clients.

These vessels support GMS' clients in a broad range of offshore oil and gas platform refurbishment and maintenance activities, well intervention work and offshore wind turbine maintenance work (which are Opex-led activities) and offshore oil and gas platform installation and offshore wind turbine installation (which are Capex-led activities).

The fleet is categorised by size into Large Class vessels (operating in water depth of up to 80m, with crane capacity of up to 400 tonnes and accommodation for up to 300 people) and Small Class vessels (operating in water depth of up to 45m, with crane capacity of up to 45 tonnes and accommodation for up to 300 people). A new third class, the Mid-Size Class vessels (operating in water depth up to 55m, with crane capacity of up to 150 tonnes and accommodation for up to 300 people) was added to the fleet in 2015.

Demand for GMS' vessels is predominantly driven by their premium capabilities as well as market growth underpinned by the need to maintain ageing oil and gas infrastructure and increasing use of enhanced oil recovery techniques to offset declining production profiles. This focus on Opex brownfield work positions GMS well against a current background of challenging macroeconomic conditions.

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