McDermott International has commented on its assessment of the financial position of the Cameron LNG project as of the end of the fourth quarter of 2018 as the U.S firm warns of continued cost overruns.
The Cameron LNG project, currently under construction in Hackberry, Louisiana, is a world-scale facility incorporating proven technology designed to produce nearly 14 million tons per year of liquefied natural gas.
In a statement the firm said: “For the fourth quarter of 2018, McDermott said it expects to report an adverse change in estimate of approximately US$168 million, due to unfavorable labor productivity, and increases in subcontract, commissioning and construction management costs. The change is expected to impact McDermott's statements of operations for the three months and year ended December 31, 2018. McDermott and Chiyoda are executing the project under a 50-50 joint venture arrangement and are fully aligned at the joint-venture level regarding the change in estimate.”
McDermott added that the Cameron LNG project is on track to reach a major milestone with feed gas into the facility later this quarter. Construction continues to progress well.
“The gas turbine solo run was completed ahead of schedule, cold circulation of hot oil in Train 1 was completed during the quarter and flare ignition testing was successfully completed on all flares. All of these are crucial steps in the commissioning of Train 1.”