Carigali Hess Contract Boosts SapuraKencana Orderbook

SapuraKencana Petroleum Bhd (SapuraKencana) RM62 million contract win for the provision of subsea inspection services for Carigali-Hess Facilities from Carigali-Hess Operating Company Sdn Bhd via its wholly-owned unit Allied Marine and Equipment Sdn Bhd (AME) has been met with approval from analysts as the contract has ensured that the group’s orderbook remains strong.

 

In an announcement to Bursa Malaysia last week, SapuraKencana stated that the contract includes the inspection of Carigali Hess jackets, pipelines and floating storage and offloading vessel (FSO).

 

AME will also provide diving equipment, remotely operated vehicle (ROV), support vessel, personnel and inspecting/recording equipment as well as tools and spares required to perform the services and other work.

 

According to Aaron Tan Wei Min from the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research), SapuraKencana’s orderbook remains strong at US$7.7 billion (approximately RM25 billion), with the tenderbook value being almost similar to the current orderbook.

 

Moving forward, he noted that SapuraKencana will be focusing more on the drilling equipment set (DES) and offshore construction and subsea services (OCSS) segments where margins are significantly higher and more value-added activities can be undertaken.

 

“In addition, the group is also looking at east two more Risk Service Contracts from Petroliam Nasional Bhd (Petronas).

 

“Channel checks indicated that the awards are likely to be announced in the first quarter of the current year 2014 (1Q14),” Tan added.

 

Overall, MIDF Research is bullish on SapuraKencana and thus maintained its ‘buy’ recommendation on the stock at a target price of RM4.86 per share, on the back of a forward price earnings ratio 15 (PER15) of 20-fold and earnings per share 2015 (EPS15) of 24.3sen.

 

“We like SapuraKencana for its integrated oil and gas business model, consistently strong orderbook replenishment (burn rate of three years) and its status as a strong beneficiary of Petronas’ strong capital expenditure (capex) spending for the next few years,” Tan explained.

Source: Borneo Post

Petronas Sudan to Continue Supply Fuel to UNAMID

Petronas Marketing Sudan Limited (PMSL), a subsidiary of Petronas, will continue to supply fuel to the African Union/United Nations Hybrid Operations in Darfur (UNAMID) following its contract renewal.

 

 In a statement Friday, Petronas said PMSL has been supplying fuel to UNAMID since 2007, and the contract was renewed in February 2013 for a further period of five years.

 

 "Petronas therefore directly facilitates the humanitarian aid operations undertaken by UNAMID," it said.

 

 Petronas said this in response to reports on its fuel supply services at Nyala Airport in Darfur, Sudan.

 

 Petronas highlighted that the purpose of its presence at Nyala Airport, which is a civilian airport, was to service UNAMID and domestic and international civilian airlines.

 

 However, it said the Sudanese government authorities, in particular the Civil Aviation Authority (CAA) of Sudan, can and does take control of the operation of the services at Nyala Airport from time to time.

 

 "This leads to PMSL and other fuel suppliers present at Nyala Airport to comply with local legal requirements, including directives issued by the CAA.

 

 "Such directives may include directing PMSL and other fuel suppliers to refuel a Sudan Armed Forces aircraft requiring such services at the airport," it said.

 

 It said the only alternative would be to cease operations altogether and thus denying the fuel supply services in support of UNAMID and to other users.

 

 "Petronas believes that PMSL's supply contract with UNAMID is evidence of its support for humanitarian aid operations in Darfur and rejects any insinuation that its human rights record is 'questionable' arising from this situation.

 

 "Throughout its operation, PMSL adheres to all applicable local and international regulations, and it shall continue to do so," it added.

 

Source: Bernama

2014 is Another Exciting Year for Oil and Gas Players

Following the discoveries of new oil and gas (O&G) reserves, 2013 has been a year packed with contracts driven nation-wide projects which led to a string of contracts awarded to various O&G players.

 

Encouraging performances in the O&G sector in 2013 has signals that 2014 is going to be another robust year with more contracts that focuses on engineering, procurement, construction and commissioning (EPCC) and engineering, procurement, construction and commissioning (EPCIC) activities expected to be awarded to local and regional O&G players.

 

Analyst Aaron Tan from the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research) highlighted that so far 2013 has been a year packed with awards of contracts, new oil and gas discoveries, and possibly more mergers and acquisitions to expand and strengthen income streams.

 

“We can expect a good mix of local, regional and international jobs to be awarded to Malaysian O&G players and we can expect Petroliam Nasional Bhd (Petronas) to keep the momentum going as it pushes for more deepwater, high pressure, high temperature, and high carbon dioxide oil fields,” he said in the research firm’s monthly review and outlook of the O&G industry report.

 

To date, according to the research arm of M&A Securities Sdn Bhd (M&A Securities) approximately RM19 billion worth of contracts have been awarded to local oil and gas players in the first half of 2013 (1H13).

 

“Half of the contracts were awarded by Petronas including PAN Malaysia Hook-Up and Commissioning (HUC) contracts which have been loaded out in May 2013,” it added.

 

In 2H13, the research firm said Petronas and its production-sharing contractors (PSC) are expected to call out some jobs which should provide huge opportunities for the local oil and gas companies.

 

These jobs include inspection, repair and maintenance (IRM) jobs of which PSC contractors such as Shell, Murphy, Carigali Hess and ExxonMobil are expected to call for IRM contracts worth between RM1 billion to RM2 billion soon.

 

In addition, Hess Corporation has called out two tenders in June for four platforms related works of seven fields in the North Malay Basin project which comprise Kamelia, Bergading, Zetung, Anggerik, Kezumba, Melati and Gajah. Kamelia field is already being developed using floating production storage and offloading (FPSO) vessel and a wellhead platform.

 

The Pan Malaysia Transportation and Installation (T&I) contracts worth between RM3 and RM5 billion has also been tendered out.

 

“Previously, the Pan Malaysia HUC jobs has been dished out in May 2013 where Dayang Enterprise Holdings Bhd (Dayang Enterprise) won RM3.8 billion worth of HUC jobs from Murphy Oil, Shell Malaysia and Petronas Carigali while Petra Energy secured RM2.5 billion package from Petronas Carigali.

 

“Finally, SapuraKencana managed to grab approximately RM500 million of HUC contract, the research firm explained.

 

Meanwhile, analyst Arhnue Tan from Alliance Research Sdn Bhd (Alliance Research) said that a slew fabrication projects have just been announced in Malaysia and Thailand.

 

“First is the Nosong CPP which has recently opened for a front end engineering and design (FEED) contest with three main contenders including Technip-MMHE, McDermott-TH Heavy, and RNZ-SapuraKencana.

 

“The FEED studies will lead to an EPCIC contract for a wellhead platform (WHP) and two pipelines. The contract is slated for award by end 2013,” Arhnue said.

In addition, Baronia CPP (an enhanced oil recovery project) and jacket (part of Baram Delta) is estimated to be 22,000 metric tonne and will be equipped with gas processing and compression facilities.

 

“The formal tender document is expected to be issued by March 2014 at the latest, leading to the potential award of the EPCIC contract in early 2015 and is likely to be an international tender,” the analyst explained.

 

Meanwhile, in Thailand, PTTEP is offering an EPCIC contract for up to 11 wellhead platforms for the Arthit field and is said to be calling an international tender slated for 2014.

 

“We view that the Nosong project will be in the range of RM200 to RM300 million as it is only for a WHP but the Baronia CPP could pan out to be another multi-billion ringgit project.

 

“Based on the news report of 22,000 metric tonne project size, we estimate the contract value at RM1 to RM1.5 billion.

 

“In Thailand, the multiple WHP contract could be sizeable as well at RM500 million to RM1 billion,” Arhnue said.

 

While these projects will open up opportunities to local O&G players, the analyst cautioned that competition could be stiff as regional heavyweights such Thai Nippon Steel, Korean shipyards Samsung and Hyundai, as well as Singapore based SMOE to be in the fray for jobs.

Aside from that, Aaron outlined that other positive industry developments include the sustained momentum in oil prices driven by sustained global demand, and cleverly orchestrated production output which would continue to spur exploration and production (E&P) activities.

 

“Petronas, along with its foreign partners are successfully hitting new oil pays locally which will trickle an abundance of services opportunity down the value chain,” he said.

 

Alliance Research expects robust contract flow would continue with new developments like marginal fields, EOR projects and new gas developments. It also expects new fabrication projects to come on-stream in late 2013 or 2014.

 

In addition, Arhnue noted that the outlook for the O&G sector in Sabah and Sarawak continues to remain robust. The analyst explained that this is similar to that of Peninsular Malaysia, with many new developments coming up as well as EOR projects.

 

MIDF Research maintained its positive stance on the sector and opined, “We can expect a good mix of local, regional and international jobs to be awarded to Malaysian O&G players and we can expect Petronas to keep the momentum going as it pushes for more deepwater, high pressure, high temperature, and high carbon dioxide oil fields.”

Source: The Borneo Post

Ministry of Energy Will Help Rural Community Produce Biomass Products

The Ministry of Energy, Green Technology and Water will provide the rural community comprising smallholders, landowners and farmers with guidance and advice on using green technology to develop high-value products from biomass, including energy.

 

Its Deputy Minister, Datuk Seri Mahdzir Khalid, said the ministry's goal was not just to promote sustainable development, but also facilitate the green economy by showing how it can contribute to economic growth.

 

"Rural communities have talent and resources, while not being strangers to hard work. "If they can only transform their mindset to a more entrepreneurial bent, and organise themselves accordingly, they can capitalise on new opportunities," he told Bernama in an interview Friday.

 

This, he said, is a quantum leap from the current mindset of depending on assistance and the ability of farmers to produce energy is a whole new economy which could help liberate them economically.

 

Earlier this year, Prime Minister Datuk Seri Najib Tun Razak announced an allocation increase of RM2 billion, for the Green Technology Financing Scheme (GTFS). The total allocation for this effort now stands at RM3.5 billion. This is meant as an incentive to small and medium industries and enterprises (SMI & SMEs) to increase the creation of green tech-based products and services.

 

"We see great potential in this industry. This is the new economy, a knowledge-based economy," Mahdzhir said. He also said the government launched the 1Malaysia Biomass Alternative Strategy Initiative (1MBAS) last year to benefit Malaysians, especially smallholders and farmers.

 

The biomass industry will grow rapidly in the next few years and is projected to be an important contributor to the energy sector, moreso with petroleum reserves to run out in less than 20 years. As a result, demand for alternative energy sources will surely increase.

 

"We have target the production of 800 megawatts of renewable energy by 2020. This requires 6-9 million tonnes of biomass (and) this amount would translate into about RM9 billion in Gross national Income (GNI).

 

"Biomass is thus poised to play a very important part in our economic future," said Mahdzhir. He said that green technology could facilitate the agricultural sector, which already contributes 12 per cent to Gross National Income (GNI), to play an even greater role in ensuring Malaysia meets the high-income nation target under the Economic Transformation Program (ETP).

 

Over the long-term, empowering the rural communities through the biomass sector would uplift their standard of living, as well as generate economic activity with tremendous downstream potential. Besides this, the implementation of the National Biomass Strategy is expected to create up to 66,000 new jobs by 2020, a variety of skills, from manual labor to areas of research and development and engineering.

 

Of this, the biomass pellet industry alone is expected to contribute 12,300 direct and indirect jobs.

 

"Here, we can imagine how this sector will change the landscape of the Malaysian economy," Mahdzhir said.

 Source: BERNAMA

SapuraKencana To Buy Newfield Assets for RM2.85bil

SapuraKencana Petroleum Bhd beat several other bidders including international oil companies to win the rights to buy Newfield International Holding Inc’s Malaysian oil and gas assets for a whopping US$898mil (RM2.85bil). It beat players like Exxon Mobil Corp, Royal Dutch Shell plc, Talisman Energy Inc and Kuwait Foreign Petroleum Exploration Co that had also put in their bids in the second round bids on Sept 26.

 

“This acquisition will further strengthen and diversify SapuraKencana group’s business portfolio and enable SapuraKencana to gain an immediate foothold and recognition as an upstream resource owner and operator,” said SapuraKencana president and group chief executive officer Tan Sri Shahril Shamsuddin.

 

Yesterday, SapuraKencana told Bursa Malaysia that it had entered into a conditional sale and purchase agreement with US-based Newfield International Holdings Inc to buy its Malaysian oil and gas assets. SapuraKencana said the deal would involve the company acquiring the entire stake in Newfield Malaysia Holding Inc.

 

The agreement is subject to the approval of national oil company Petroliam Nasional Bhd under the applicable production sharing contracts (PSC), SapuraKencana’s shareholders and other customary closing conditions.

 

“The profitable Newfield Malaysia business has an excellent HSE (health, safety and environmental) and operational track record backed by a strong execution team and cash-generating assets (about 23,000 barrels per day net production in 2012),” added Shahril.

 

SapuraKencana said it would finance the acquisition via a combination of internally generated funds and external bank borrowing.

 

In Malaysia, Newfield’s subsidiaries have interest in nine PSC blocks, spread between the Peninsular Malaysia’s oil producing region and the gas producing regions of Sabah and Sarawak. Its total Malaysian portfolio comprises 3.3 million net acres.

 

“In essence, we are acquiring a proven oil and gas operator with a balanced portfolio of producing and discovered fields and exploration assets in Peninsular Malaysia, Sabah and Sarawak.

 

“As a field owner and operator, this business will require different set of operating principles and as such we will manage this new business division separately as an independent subsidiary.

 

“We are confident that we will be able to grow the business further and provide a unique value proposition to our partners,” Shahril explained.

 

Under the proposed transaction, Newfield International would offer preferential rights to its partners to acquire the assets of Newfield Malaysia and its subsidiaries – Newfield Sabah Malaysia Inc, Newfield Peninsular Malaysia Inc and Newfield Sarawak Malaysia Inc.

 

In the event any of the PSC partners exercise their preferential rights for a particular asset, the allocated value for the respective asset would be reduced from the purchase price.

 

SapuraKencana said that barring unforeseen circumstances and subject to all required approvals being obtained, the proposed acquisition was expected to be completed in the first quarter of 2015.
 

Source: The Star

Sabah Emerges As Important O&G Hub In Region

Sabah, which has among the highest oil reserves in the country, has emerged as an important oil and gas (O&G) hub in this region, said Universiti Malaysia Sabah (UMS) vice chancellor Prof Datuk Dr Mohd Harun Abdullah.

He said this was evident from the major shifts in the O&G industry in harnessing these reserves, including offshore projects such as Kikeh, Gumusut Kakap, Malikai, Kababagan, Jangas, Ubah Crest, Pisangan and Kamunsuand.

Apart from offshore projects, Mohd Harun said there were also onshore projects -- Sabah Oil & Gas Terminal in Kimanis, Sipitang O&G Industrial Park and Kimanis-Bintulu gas pipeline that galvanise the O&G industry in the state.

"In all, these O&G upstream and downstream industries need 16,000 skilled manpower annually to meet the growing demand by 2020 as outlined by Federation of Accredited Department of Skills Development Malaysia," he said in his keynote address in conjunction with the International O&G Symposium in Likas near here Wednesday.

His text of speech was delivered by Dean of UMS's School of Engineering and Information Technology Assoc Prof Dr Rosalam Sarbatly.

Mohd Harun said the O&G sector played a significant role in the development of the nation, contributing more than 40 per cent to the country's national income.

In this respect, he said UMS had established post graduate course in O&G last year and embarking to start an undergraduate course in its School of Engineering and Information Technology.

He said the university also introduced diploma programmes in five disciplines namely process, instrumentation, mechanical, electrical and utility at UMS campus in Labuan with the strategic objective to becoming a leading player in O&G manpower development.

He said UMS aspired to work with the institutions, industries and research organisations to create a culture of excellence, investing in skills and encouraging research and innovation.

"Now it is for the industry as a whole to play a greater role in developing human capital through partnerships and collaborations and working with learning institutions to develop O&G talent and for new discoveries," he said.

Source: Bernama

Petronas Penapisan Melaka to Defer Retrofitting Project

Petronas Penapisan Melaka Sdn Bhd, a wholly-owned subsidiary of Petronas), has decided to defer the proposed retrofitting project at its lube base oil plant in Malacca.

In a statement Thursday, Petronas said the deferment took into account the current uncertain market outlook for base oil and the prices in the submitted bids that have adversely impacted the economic viability of the project.

"All projects in Petronas undergoes a strict stage-gating process in which the final investment decision - where costs, market outlook and all related factors that impact project economics and execution are diligently considered - is a key milestone that determines whether or not projects are sanctioned," it added.

The plant, which began commercial operations in 2008, produces approximately 270,000 tonnes per year of mostly group three base oil, a major component for the manufacture of top tier automotive and industrial lubricants.

The retrofitting project, had it gone ahead, would have increased its production capacity by approximately 15 per cent by 2017.

Source: Bernama

Principal Subsea Pipeline Engineer Jobs

LOCATION: MALAYSIA 
 
Responsibilities

As a Principal Subsea Pipeline Engineer, you will be responsible for the following:

• Completion and delivery of pipeline engineering consultancy work for all types of subsea developments.
• Development of conceptual designs and performing front end engineering for subsea pipeline systems.
• Ensuring the provision of efficient, high quality engineering and preparation of associated clear, concise, high quality reports.
• Interfacing with clients, suppliers and sub-contractors.
• Developing proposals and tenders
• Leadership and supervision of graduate engineers

Requirements

Suitable candidates will ideally possess the following qualifications and experience:

• An engineering degree (honours or equivalent) in mechanical, civil or similar.
• Chartered status is considered advantageous
• A thorough understanding of the fundamentals of subsea pipeline engineering with six years or greater relevant experience.
• Knowledge of HPHT and deepwater subsea facility design including pipeline buckling assessment
• Conversant with applicable DNV, BS & API Codes/Standards for subsea pipeline design and other relevant International Codes/Standards.
• Experience of concept / feasibility studies and FEED studies including the development of architecture options and field layouts, project execution philosophies, and attendance of review meetings, constructability reviews, HAZID etc.

Candidates should also possess the following personal skills/qualities:

• Potential and desire to progress to Principal Consultant status and beyond
• A co-operative and helpful attitude to colleagues and clients
• Self-motivated, reliable, consistent and mature approach to work
• Ability to lead small teams, and interest in developing junior staff and line management
• Ability to cope rapidly with challenging problems
• Ability to build relationships and win work from new and existing clients

Please send your application to ecavador@gmail.com

Thank you.