March 12 (Bloomberg) -- Kvaerner ASA, a Norwegian builder of oil platforms, climbed the most in more than four months in Oslo trading after winning a $1.5 billion contract from Exxon Mobil Corp. in Canada.
Kvaerner rose as much as 8.1 percent, the biggest intraday gain since Oct. 31, and traded up 4 percent at 12.9 kroner as of 12:23 p.m. local time. Trading volumes today have already surpassed the three-month daily average.
Exxon awarded Kvaerner an engineering, procurement and construction-services contract for the Hebron heavy-oil project off Canada’s eastern coast, according to a statement today. That may ease investor concern that rivals of the Fornebu-based company were beating it to new orders.
“This is a strategically important project for us,” Kvaerner’s executive vice president responsible for concrete solutions, Bjoern Gundersen, said in the statement.
Kvaerner has slumped more than 20 percent in two months, dropping as much as 6.6 percent on Jan. 21 after losing out on a $1.1 billion contract for the Aasta Hansteen gas project to Hyundai Heavy Industries Co. Competitors Daewoo Shipbuilding & Marine Engineering Co. and SembCorp Marine Ltd. have also won so-called topside contracts this year.
The total value of the Hebron project to Kvaerner is about 8.5 billion kroner ($1.5 billion), including about $240 million of work already conducted, Pareto Securities ASA said in an e-mailed note. “New work is thus 7.1 billion kroner, below our 9 billion-kroner estimate but largely in line with consensus.”
Kvaerner, which was spun off from Aker Solutions ASA in 2011, may also benefit from a decision by Talisman Energy Inc. and SBM Offshore NV to scrap a platform at the Yme field in the Norwegian North Sea, Nordea Bank AB said in a note to clients.
Possible work at Yme “could provide a new home-market opportunity for Kvaerner from a client badly burned by poor execution,” Nordea said. “The absence of home-market topside awards has made investors question Kvaerner’s business model.”
Topside describes the upper half of an offshore oil platform, on which equipment is installed.
Aker ASA, which owns about 28 percent of Kvaerner, has urged the company to focus on regaining market share in Norway rather than bidding for higher-risk international projects.
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