Singaporean offshore rig builder Seatrium’s Estaleiro Jurong Aracruz in Brazil has refinanced a maturing loan facility with an ESG-linked $500m loan from Singapore’s Standard Chartered Bank.
Seatrium said the shipyard’s new debt facility has “an innovative sustainability-linked conversion option” that is aligned with the Loan Syndications and Trading Association’s Sustainability-Linked Loan Principles covering finance tied to environmental, social and governance (ESG) factors.
“This will support Seatrium in achieving its ESG targets over time through adjustments to the loan characteristics upon conversion,” Seatrium said in a statement.
Seatrium said it plans to fill out 40% of its net orderbook from renewables and cleaner and green solutions, as well as lower greenhouse gas emissions by 40% by 2030.
As TradeWinds reported in mid-May, Seatrium’s net orderbook crossed SGD 20bn ($14.9bn) in the first quarter as it moved away from fossil fuel-based projects.
The first quarter of 2023 saw the company, which is formerly known as Sembcorp Marine, land its largest ever offshore renewable project to supply the high voltage direct current electrical transmission systems for three mega offshore wind farm projects.
Each project is valued at around €2bn ($2.2bn) from TenneT TSO BV.
Seatrium also recently secured a contract worth more than SGD 500m for two offshore wind farm substations from Empire Wind LLC, a US joint venture between Equinor and bp.
Seatrium was created by the April 2023 merger between Sembcorp Marine and Keppel Corp’s offshore and marine arm.
As a result of merger-related costs, Seatrium posted a first-half loss of SGD 264.4m ($197.3m), up from a SGD 142.9m loss recorded in the same period in 2022.