The engineering, procurement, and construction (EPC) sector for the oil and gas industry is anticipated to experience robust demand for the next several years. This positive outlook persists despite short-term challenges such as low oil prices and geopolitical shifts, as industry strategies are fundamentally long-term in nature.

Market Outlook and Backlog

McDermott International maintains a global backlog that stood at $17.5 billion at the end of the third quarter of last year and continues to increase. This growth is driven by steady demand across both onshore and offshore projects. The company is optimistic about its global EPC business, encompassing oil, gas, onshore, offshore, and energy transition projects. Specifically, its backlog in onshore liquefied natural gas (LNG) projects is growing, while offshore projects remain robust.

Recent Project Awards and Regional Strengths

The company has recently secured significant new projects, particularly in the Middle East, reinforcing its positive regional outlook. Key awards include a $942 million contract from Abu Dhabi National Oil Company (Adnoc) for the Nasr oilfield development, an expected EPC contract for Adnoc’s SARB Deep Gas Development, and a major offshore contract from QatarEnergy. McDermott has strong relationships in the UAE, Qatar, and Saudi Arabia, where it is a key member of Saudi Aramco’s long-term agreement framework.

Other notable backlog projects span multiple regions and include a large subsea contract for PTTEP’s Block H gas field in Malaysia, a contract with Woodfibre LNG in Canada, Adnoc’s Umm Shaif LTDP 2.0, packages for Qatar’s North Oil Company, a high-voltage direct current portfolio for TenneT, and onshore LNG projects in Mozambique and Texas.

Future Opportunities and Execution Capabilities

Looking ahead, specific regional opportunities are identified. The Middle East is expected to continue offering shallow-water prospects, while strong deepwater opportunities are seen in South America and Asia Pacific. Onshore opportunities are noted in Africa and developing prospects in North America.

McDermott’s competitive position is bolstered by its integrated execution capabilities. This includes a unique combination of vessel fleet, engineering expertise, and a global network of five strategically located fabrication yards in Dubai, Qatar, Mexico, China, and Indonesia, with a combined capacity of 270,000 tonnes. This infrastructure provides strong execution capabilities and allows the company to precisely forecast and manage its long-term project pipeline, which it believes is sufficient for the coming years.