sunztzhekahhoeng, Please don't haha too soon. I have the following questions to ask you and the questions are very simple "Do you personally know the CEO and owner of Puncak?" "How much do you know on who actually owns how much in Puncak?" "What has Puncak stated and documented on what Puncak will do with the cash that it receives?" "Has Puncak stated publicly that it will declare certain dividends $$$ upon receiving the cash or it is merely your own speculation or your own expectation?"
kahhoeng Hmm... sunztzhe, care to share? All I know the two biggest shareholders own between 50 - 52%, with lth buying up the most of late. Proceed from water asset sale should amount to 3.00-3.30 per share. Net cash per share after sale is not clear, probably between 3.00 - 3.50. Most analyst reports suggested between 0.25 - 0.60 dividend,i m hoping for 1.00 - 1.50, too ambitious?
mbge7clthope you are right! ha..ha... the more the merrier... but knowing corporate Malaysia always keep some for themselves...
kahhoengwell, we have to judge for ourselves if what was said has merit.
sunztzheThe new normal is already here--> Crude Oil price + or - USD 80 How will PETRONAS decide on their future CAPEX? Focus on shallow wells or go for costly deeper wells? How will this impact on PUNCAK Oil & Gas future business??
kahhoengsuntzhe, at current price, the o&g part of Puncak businesses is basically priced at 0, hmm..., assuming I am right about its asset value and quality. Though, unless Puncak board is speeding up the water deal and clearly states how the cash from deal be spent, doubt there will much price swing (up, hopefully).
sunztzhekahhoeng, With the new normal crude oil price of + or - USD 80/barrel, do you expect more or less capex from PETRONAS and other Oil majors going forward. The new normal price in a secular bear crude oil market will last for years as the increasing supply from Libya n US shale oil is causing the Oil glut. So the prospect for CAPEX UPSTREAM will be cut and will diminish and will lead to a global industry shakeout that may last easily 3 or more years. Premiums for future offshore services with PETRONAS will evaporate and the price premium enjoyed by service companies in the past will not recur in the future awards.
The current T&I project will soon be completed by Dec 2014 or early 2015.Has Puncak won any new T&I projects in the last 3 months? Has PETRONAS announced new UPSTREAM CAPEX lately since the crude oil price crashed to USD 80/barrel? I think most Oil majors including PETRONAS will reconsider or cut future CAPEX for UPSTREAM.
UPSTREAM Oil & Gas services was the darling for past 3 years when crude oil prices was USD 110 per barrel. It is no longer the case now with crude oil price of + or- USD 80 /barrel which will last for years in the future. If PUNCAK does not secure new T&I projects, it will incur recurring costs n incur future losses. In that case, Better focus on KPS where the cost for raw water is ZERO
kahhoengsunztzhe, will take your viewpoint into consideration. Though, I suppose it would be safe so long Puncak share price is below 3.80. Current share price seems to reflect only its Selangor water business to be sold to the government. We have yet to know what asset will be returned to Puncak for not being related to Selangor water business. And, I suppose its other water businesses should carry some value, in addition to its o&g business that may result in losses or fail to secure projects in the future.
Truth is, the way I look at the o&g industry, the demand is still there, just that the growth has slowed. So long Malaysia o&g has a cost structure that's below 70, we should be safe, so is Puncak. Puncak's o&g business may no longer as lucrative, it's not running out of business. If this part of business is valued at a PE above 15, I would be worry. Given 0 valuation, I suppose its safe.
sunztzhekahhoeng, The new normal price of crude oil at + or - USD 80/barrel would force an industry wide shakeout. We are just at the cusp of a new beginning of a global industry shakeout. UPSTREAM service providers will also be impacted. High capex projects for deep wells with production cost of USD 80/barrel is not economically feasible anymore. Major Oil & Gas companies had already made that decision. The UPSTREAM OIL & GAS SWAN had suddenly become an UGLY DUCKLING.
There will be also a shakeout of the upstream SERVICE PROVIDERS AS WELL.