McDermott International, Ltd

McDermott International, Ltd is a global provider of engineering and construction solutions for the energy industry. Headquartered in Houston, Texas, the company's mission is to responsibly harness and transform global energy resources into essential products, while advancing global energy infrastructure for a sustainable future.

The company offers integrated engineering, procurement, fabrication, construction, and installation (EPFCI) solutions across various market segments, including onshore, offshore, subsea, and floating facilities. Its services encompass LNG solutions, refining and petrochemical facilities, gas processing plants, and oil and gas import and export terminals. McDermott is also actively engaged in the energy transition, focusing on Low Carbon Solutions such as hydrogen, carbon capture, sustainable aviation fuels, and offshore wind.

McDermott operates in over 30 countries with more than 30,000 employees. Michael McKelvy has served as President and CEO since February 2022. The company reported a backlog of $18.2 billion at the end of 2025, reflecting strong project execution and strategic positioning in both conventional and emerging low-carbon energy infrastructure. Recent notable activities include the completion of construction and commissioning for Golden Pass LNG Train 1 and securing new contracts for offshore decommissioning and field development projects.

Latest updates

McDermott Exceeds 2025 Guidance, Cautions on Middle East

Event summary

  • McDermott reported $10.0 billion in revenue for full-year 2025, exceeding prior guidance.
  • The company's backlog reached $18.2 billion at the end of 2025.
  • Adjusted EBITDA for the year was $428 million, and cash flow from operations totaled $340 million.
  • CEO Michael McKelvy highlighted improved backlog quality and operational discipline.
  • McDermott is closely monitoring conditions in the Middle East, where it maintains operations.

The big picture

McDermott's strong 2025 performance underscores the continued demand for engineering and construction services within the energy sector, particularly as infrastructure investment remains a priority. However, the company's acknowledgement of Middle East instability highlights the inherent risks associated with operating in geopolitically sensitive regions, which could impact future revenue streams and project execution. The $18.2 billion backlog provides a buffer, but the ability to convert that backlog into profitable projects will be key to long-term success.

What we're watching

Geopolitical Risk
The company's commentary on the Middle East suggests potential volatility; sustained operational continuity will depend on navigating regional instability and its impact on project timelines and costs.
Execution Risk
While McDermott cites improved execution, sustaining this momentum in 2026 will be critical to maintaining investor confidence and delivering on the stated plan.
Backlog Quality
The stated improvement in backlog quality needs to be substantiated by project profitability and contract terms; a deeper dive into the composition of the backlog is warranted during the earnings call.

Golden Pass LNG Train 1 Startup Boosts McDermott's Project Pipeline

Event summary

  • McDermott and Chiyoda have completed construction and commissioning of Train 1 at the Golden Pass LNG Project.
  • Golden Pass LNG Terminal LLC initiated start-up operations, achieving first LNG production from Train 1.
  • McDermott serves as the lead partner for the joint venture, responsible for all three LNG trains at the facility.
  • The Golden Pass LNG Project is one of North America's largest LNG developments.

The big picture

The Golden Pass LNG project represents a significant investment in North American LNG export capacity, contributing to global energy supply diversification. McDermott's role as lead contractor underscores its position in the expanding LNG infrastructure market, but also exposes it to the risks inherent in large-scale, complex construction projects. The successful completion of Train 1 is a key step, but the remaining two trains represent a substantial ongoing commitment.

What we're watching

Project Execution
The successful start-up of Train 1 provides a crucial data point for assessing McDermott's ability to deliver the remaining two trains on schedule and within budget, given the complexity of LNG infrastructure projects.
Market Dynamics
Continued LNG demand and pricing volatility will influence the profitability of the Golden Pass project and McDermott's ability to secure future contracts in the sector.
Partner Alignment
The ongoing collaboration between McDermott, Chiyoda, and Golden Pass LNG Terminal LLC will be critical for the successful completion of Trains 2 and 3, and any disagreements could impact project timelines and costs.

McDermott Bolsters Sustainability Credentials with EY Assurance, Targets Green Infrastructure

Event summary

  • McDermott published its 2025 Sustainability Report on March 31, 2026.
  • The company achieved a 20% reduction in absolute Scope 1 and 2 emissions versus a 2020 baseline.
  • McDermott secured voluntary limited assurance from EY for Scope 1 and Scope 2 greenhouse gas emissions.
  • The company sourced 92% of its grid electricity demand from renewable sources.
  • McDermott is progressing on sustainable aviation fuel facilities in North America and Europe, a green steel project, and high-voltage direct current infrastructure.

The big picture

McDermott's sustainability report underscores the growing pressure on energy infrastructure providers to demonstrate environmental responsibility. The company's focus on lower-carbon solutions and third-party assurance aligns with investor and client demand for greater transparency and accountability. This report positions McDermott to compete for increasingly stringent contracts, but also exposes it to potential reputational risk if its claims are not substantiated.

What we're watching

Governance Dynamics
The reliance on voluntary third-party assurance from EY signals a commitment to transparency, but the long-term cost and scalability of this practice will be a key factor in McDermott’s overall sustainability program.
Execution Risk
The success of McDermott’s lower-carbon infrastructure projects, particularly the green steel initiative in Europe, hinges on navigating complex regulatory approvals and securing reliable supply chains.
Regulatory Headwinds
Increased scrutiny of ESG reporting and potential mandatory carbon disclosure requirements could force McDermott to further refine its data collection and reporting processes, impacting operational costs.

McDermott Secures ISO 50001 Certification for Key Vessels, Signaling Efficiency Push

Event summary

  • McDermott International has achieved ISO 50001 certification for its DB32, DB50, and DLV2000 vessels, completed in 2025.
  • The certification follows similar achievements at four McDermott fabrication yards.
  • ISO 50001 certification requires a formal energy management system, including performance baselines and real-time monitoring.
  • The certification is intended to support customer decarbonization goals and enhance McDermott’s role as a sustainable offshore execution partner.

The big picture

McDermott’s ISO 50001 certification represents a strategic shift towards demonstrating tangible sustainability credentials in a sector increasingly pressured by environmental, social, and governance (ESG) concerns. This move aligns with the broader trend of energy companies seeking to reduce their carbon footprint and meet increasingly stringent regulatory requirements. While the financial impact of the certification remains to be seen, it positions McDermott to potentially gain a competitive advantage in bidding for projects with sustainability mandates.

What we're watching

Customer Adoption
The extent to which McDermott’s customers prioritize and reward this certification in contract negotiations will indicate the market’s appetite for sustainable offshore solutions.
Cost Savings
Whether the implemented energy management system delivers demonstrable cost savings across the certified vessels will validate the investment and drive wider adoption within McDermott’s fleet.
Scope Expansion
The pace at which McDermott extends ISO 50001 certification to its remaining fleet and onshore facilities will reveal the depth of its commitment to a broader sustainability program.

McDermott Lands $750M-$1B EPCI Contract for ADNOC Expansion

Event summary

  • McDermott has been awarded an EPCI contract by ADNOC, estimated to be between $750 million and $1 billion.
  • The contract covers the Nasr-115 Expansion Project, a component of the larger Nasr Phase II Full Field Development.
  • The Nasr Phase II project aims to increase oil production capacity to 115,000 barrels per day by 2027.
  • McDermott's scope includes two topside structures, a manifold tower, a jacket, a bridge, and associated pipelines and modifications.

The big picture

This contract represents a significant win for McDermott, bolstering its position as a key EPCI provider in the Middle East. ADNOC's Nasr Phase II expansion underscores the ongoing demand for increased oil production capacity, despite global pressure to transition to renewable energy sources. The project’s scale highlights the continued importance of hydrocarbon resources in meeting global energy demand, and McDermott's involvement signals a commitment to supporting these efforts.

What we're watching

Execution Risk
The project's success hinges on McDermott's ability to deliver on a large, complex offshore project within the stated timeframe and budget, given ongoing supply chain challenges and potential labor constraints.
Geopolitical Factors
Continued stability in the UAE and broader geopolitical dynamics in the region will be crucial for the project's uninterrupted progress and ADNOC's overall production targets.
Financial Health
McDermott's financial performance will be closely scrutinized to ensure it can adequately fund and manage this project, particularly given the company's history of financial volatility.
CID: 2570