Keppel and Sembcorp Marine’s O&M businesses have been hard hit by the drastic reduction in oil and gas exploration activities in recent years as energy companies pivot towards the production of cleaner and renewable energy. The Covid-19 pandemic exacerbated the situation, driving both companies into the red last year, with a combined net loss of S$1.3 billion, as oil demand and prices plunged.

The merger will help the resulting company seek opportunities not just in the oil and gas sector, but also in renewable energies, such as offshore wind and alternative sources including hydrogen, according to the statement.

The combined entities’ pivot towards cleaner energy business is expected to bolster their order book, which stood at S$6.4 billion in 2021, in the next few years. Global investments in offshore renewable and cleaner energy solutions are expected to exceed S$500 billion between 2021 and 2030, the companies said, citing market research by a world-leading consultant.

According to Forbes