‘Recovery in O&G industry hindered by low capex’

January 20, 2018

Dateline 2017-11-29, The Edge:

UMW Oil & Gas Corp Bhd (UMW-OG), a stock that has fallen out of favour after the meltdown of crude prices in late 2014, beat estimates with its first-ever profitable quarter in two years in the third quarter ended Sept 30, 2017.

The performance brought fresh optimism about earnings recovery for other upstream players. But is the long wait finally over? Analysts are still sceptical, with no consistent work order flow in the local upstream segment with national oil firm Petroliam Nasional Bhd (Petronas) sticking to upstream capital expenditure (capex) cuts.


Kuantan Port to house RM5.1 billion oil refinery complex

January 7, 2018

Dateline 2017-11-13, The Edge:

Kuantan Port Consortium Sdn Bhd and NewOcean Energy (Malaysia) Sdn Bhd, a unit of energy supplier Hong Kong-listed NewOcean Energy Holdings Ltd, have signed land sublease and terminalling agreements for the development of NewOcean’s oil refinery complex in Kuantan Port.

The project, estimated to cost approximately RM5.1 billion, comprises an oil refinery with an annual production capacity of 3.5 million tonnes, a tank farm serving as a storage depot for entreport trade purposes and a blending plant for various grade of petroleum products.

RM4.5b Trans Sabah Gas Pipeline to be funded with loan from China, guaranteed by Malaysia

December 23, 2017

Why not just say, paid by Malaysia?

Dateline 2017-11-08, The Edge:

The Trans Sabah Gas Pipeline (TSGP) will be funded by a soft loan of RM4.53 billion from the Export and Import (EXIM) Bank of China and guaranteed by the Malaysian government, said Minister in the Prime Minister’s Department, Datuk Seri Abdul Rahman Dahlan.

The RM4.53 billion constitutes the total cost of the project, Rahman Dahlan said in a statement today, refuting an allegation on social media that Prime Minister Datuk Seri Najib Razak had collateralised oil and gas blocks off Sabah to China for a loan of RM100 billion.


Analysts: No major changes from Petronas’ cautious approach

December 2, 2017

Dateline 2017-10-24, Borneo Post Online:

Analysts expect no significant changes from Petroliam Nasional Bhd’s (Petronas) cautious approach to upstream exploration and development expenditures .

According to AmInvestment Bank Bhd (AmInvestment Bank), persistently low asset utilisation levels are anticipated for the medium term in the oil and gas sector as the research firm did not expect any significant change in Petronas’ cautious approach to upstream exploration and development expenditures.

AmInvestment Bank noted that for the second quarter of 2017 (2Q17) to date, contract awards have risen by 15 per cent quarter on quarter (q-o-q) RM2.2 billion largely due to the lumpy award of the RM1 billion Bokor central processing platform project to Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE).


RM6b Petronas deals unlikely to be catalysts for oil & gas sector: AmBank Research

November 9, 2017

Pop quiz: what catalysts do you know?

Dateline 2017-09-18, The Sun:

AmBank Research is of view that a reported RM6 billion maintenance, construction and modification (MCM) contracts rollout by Petroliam Nasional Bhd (Petronas) is unlikely to work as a catalyst for the oil and gas sector, maintaining the sector’s neutral call.

It was previously reported that, Petronas has conducted a pre-award meeting for the delayed contracts which were expected out in the second quarter of the year.

“Petronas’ recent focus on reshuffling its upstream portfolio amid a review of its capital and operating expenditure against the backdrop of a lower crude oil price environment has negatively impacted the local services sector. It is uncertain whether Petronas would split the MCM jobs into six packages for a 5-year duration as earlier envisaged,” AmBank said.

Essentially, these new contracts, which are a relief for the sector, are to replace the existing service jobs currently held by the incumbents. These could offer a respite for vessel utilisation rates. However, in terms of value accretion, we do not expect any significant increase in day rates, given the currently depressed offshore market,” it added.

Malaysia on target to become regional oil and gas hub: MPRC

October 22, 2017

Dateline 2017-09-11, NST:

Malaysia is set to become the oil and gas hub by year 2020 and is well on target towards becoming a regional hub within three years.

Malaysian Petroleum Resources Corporation (MPRC) said the country, deemed as one of the fastest growing economies in the Asia Pacific region and home to market-oriented economy and pro-business government policies, is also aims to ensure its local players to become regional players in the sector.

MPRC chief executive officer Datuk Shahrol Halmi said it is important to have Malaysia’s reputation at play to become a hub, and not just beating the drum claiming to be one.

“We also have strategies to ensure that we get there, and working hard to make sure it happens.

“It is crucial to attract the multinational companies (MNCs) to come to Malaysia and ensure that they make Malaysia as a regional base for the region.

“A hub is not just a hub. It brings other benefits to the Malaysian economy such as technology transfers, job opportunities and high-paying jobs as well,” Shahrol said in an exclusive interview with NST Business recently.


Malaysia’s Largest Company to Push Ahead with Acquisition of Daewoo E&C

October 14, 2017

Not Malaysia focused, but hey.

Dateline 2017-09-01, Business Korea:

Petronas, a world-class energy company, will press ahead with the acquisition of Daewoo E&C, following global players including Saudi Arabia’s Aramco who revealed its will to take part in a bid for Daewoo E&C to be held within this year. Such moves are raising a possibility that Daewoo E&C will be sold off for a higher price. Its estimated selling price is about 2 trillion won (US$1.8 billion).

According to the investment banking (IB) industry on August 31, Malaysia’s Petronas is considering the acquisition of the Korea Development Bank’s 50.75% stake in Daewoo E&C including the management right. Petronas will participate in taking over Daewoo E&C in October after reviewing Daewoo E&C’s business structure, financial conditions and business performances by September. Petronas is said to be planning to forge a local consortium with Maybank and CIMB.