The contract will operate for three years with an option for a further two years and represents a further move towards longer term contracts that will provide a greater balance between the Group’s annuity and spot income streams.

To meet the forecast work load the company has chartered a 52 tonne bollard pull ocean going tug from its largest shareholder, PSA Marine (Port of Singapore Marine). The arrangement will satisfy the short term requirements, and will be reviewed over coming months in favour of ownership alternatives.

Last week a Mermaid Marine/Clough Joint Venture successfully completed its most recent contract for Apache Energy and its partners by laying and securing 4.5km of pipeline from the new Linda Platform and subsea connection to the existing Campbell Pipeline in North West Australia's Carnarvon Basin.

In January the company also secured a lucrative contract to provide logistics and supply base support to the massive Santos Mutineer/Exeter oil field development.

Santos and its JV partners have earmarked $480 million for the development in the Carnarvon Basin, which is expected to produce first oil by mid 2005 with an estimated production life of around 7 years.

The Mermaid contract will utilise the company's recently developed Dampier Supply Base, which was designed to provide an integrated approach that linked shore-based supply services to marine operations through a dedicated waterfront facility.