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Oil and Gas Malaysia News

Author: acinanatucer   |   Latest post: Tue, 12 Oct 2021, 1:04 PM

 

Harga minyak mentah lepasi AS$80 setong, rancakkan kaunter Sapura Energy

Author: acinanatucer   |  Publish date: Tue, 12 Oct 2021, 1:04 PM


 

Sapura Energy Bhd., muncul antara kaunter minyak dan gas (O&G) paling aktif diniagakan di Bursa Malaysia dalam dagangan pagi ini berikutan kenaikan harga minyak melepasi paras AS$80 setong.

Setakat 11.02 pagi, harga sahamnya menokok 0.05 sen atau 4.76% kepada 11 sen dengan 67.8 juta saham diniagakan.

Pada Isnin, Reuters melaporkan harga minyak mentah Brent meningkat AS$1.26, atau 1.5% kepada AS$83.65 setong manakala West Texas Intermediate (WTI) menokok AS$1.17, atau 1.5% kepada AS$80.52 setong.

Selain Sapura Energy, saham Hibiscus Petroleum juga rancak diniagakan dengan harganya menokok 0.05 sen kepada 89.5 sen manakala KNM Group Bhd. juga menokok 0.05 sen kepada 23.5 sen.

Menurut CGS-CIMB dalam nota kajian hari ini, kenaikan harga minyak mentah global melepasi paras AS$80 setong baru-baru ini, meletakkan kedudukan akaun semasa Malaysia yang lebih baik berbanding negara lain di rantau ini.

Namun, firma itu berkata, pemberian subsidi bahan bakar secara blanket pula mempengaruhi kedudukan fiskal kerajaan. 

Sebagai pengeksport bersih minyak, Malaysia menyaksikan lebihan dagangan bagi sektor minyak dan gas (O&G) Malaysia yang lebih besar, meningkat kepada RM26.6 bilion dalam tempoh 8 bulan bagi tahun ini.

Sebahagian besar lebihan dagangan ini disumbang menerusi gas asli cecair (LNG) meningkat kepada RM21.5 bilion dalam tempoh berkenaan diikuti petroleum (RM3.7 bilion) dan produk berasaskan petroleum (RM1.6 bilion).

"Dengan mengandaikan LNG bergerak seiring dengan harga minyak mentah, setiap kenaikan AS$10 bagi setong bagi harga minyak mentah akan meningkatkan kedudukan akaun semasa Malaysia kepada 0.4% kepada Keluaran Dalam Negara Kasar (KDNK).  

"Bagi Malaysia, kami menganggarkan tambahan hasil kerajaan sebanyak RM430 juta untuk setiap kenaikan AS$1 setong harga minyak mentah selepas mengambil kira kelemahan tukaran asing (ringgit/dolar AS), adalah lebih tinggi berbanding anggaran rasmi, RM300 juta," katanya.  

Menurut CGS-CIMB, kerajaan mula menanggung subsidi bahan bakar apabila harga minyak mentah mencecah AS$60 setong dengan tambahan subsidi dianggarkan sebanyak RM650 juta untuk setiap kenaikan AS$1 setong. 

"Oleh itu, keseluruhan subsidi bagi petrol RON95 dan diesel mendedahkan kemerosotan baki fiskal Malaysia sebanyak RM2.2 bilion atau 0.1% daripada KDNK untuk setiap kenaikan AS$10 setong melebihi AS$60 setong," jelasnya. 

Sementara itu, bagi negara di rantau ini, firma itu mendapati sebagai pengimport bersih minyak, Indonesia, Singapura dan Thailand akan dikenakan bil import O&G yang lebih tinggi. 

Tetapi, katanya, ia melihat risiko yang berkurangan dari segi kemerosotan akaun semasa bagi Indonesia untuk tempoh ini dengan mengambil kira lebihan dagangan lebih tinggi menerusi minyak sawit mentah, arang batu dan harga logam asas. 

Situasi ini tidak menyamai seperti yang berlaku pada 2012-2014 dan 2018-2019 apabila defisit dagangan semakin meningkat disebabkan lebihan dagangan bukan O&G yang rendah. 

"Bagi Thailand pula, akaun semasanya jatuh kepada defisit buat kali pertama sejak 2013, susut AS$10.2 bilion dalam tempoh 8 bulan tahun ini berbanding peningkatan AS$20.3 bilion bagi tempoh sama tahun lalu, yang mungkin terus merosot memandangkan kedatangan pelancong yang kurang," katanya.

Labels: SAPNRG
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US oil hits 7-year high after Opec+ resists calls to accelerate production

Author: acinanatucer   |  Publish date: Wed, 6 Oct 2021, 10:52 AM


 

Oil prices jumped on Tuesday, with U.S. crude hitting its highest since 2014 and Brent futures climbing to a three-year high, after the OPEC+ group of producers stuck to its planned output increase rather than raising it further.

On Monday, OPEC+ agreed to adhere to its July pact to boost output by 400,000 barrels per day (bpd) each month until at least April 2022, phasing out 5.8 million bpd of existing production cuts.

U.S. West Texas Intermediate (WTI) oil closed up $1.31, or 1.7%, at $78.93 a barrel. During the session it surged more than 2% to as high as $79.48, the most in nearly seven years. Brent crude settled up $1.30, or 1.6%, at $82.56. Earlier, Brent hit a three-year high of $83.13.

Both contracts extended gains made on Monday, when they each rose more than 2%.

"The market is realizing we are going to be undersupplied for the next couple of months and OPEC seems to be happy with that situation," said Phil Flynn, an analyst at Price Futures Group in Chicago.

Oil prices have already surged more than 50% this year, adding to inflationary pressures that crude-consuming nations such as the United States and India are concerned will derail recovery from the COVID-19 pandemic.

Late last month, the OPEC+ Joint Technical Committee (JTC) said it expected a 1.1 million bpd supply deficit this year, which could turn into a 1.4 million bpd surplus next year.

Despite pressure to ramp up output, OPEC+ was concerned that a fourth global wave of COVID-19 infections could hit the demand recovery, a source told Reuters a little before Monday's talks.

Rocketing global natural gas prices, which may incentivize some power generators to switch from gas to oil, mean crude prices are likely to remain supported even though there could be a short-term pullback, said Gary Cunningham, director of market research at Tradition Energy.

"I think there will be some profit-taking ... but we are going into winter with very high natural gas prices," Cunningham said, adding that he expects Brent will find support around $80 and WTI in the mid-$70s.

Investors will look to Wednesday's crude inventory data from the U.S. Energy Information Administration for further direction.

U.S. crude oil and distillate inventories are likely to have fallen last week, a preliminary Reuters poll showed.

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Tobby The reason is simple! Because US today is so weak! OPEC and Russia once again can do whatever they want! They don't have to be afraid of US at all! Biden administration today is at the US weakest! Gone are the days where US leaders can tell other nations what to do! Instead, the world is now leaderless! China is the new superpower but it has yet to replace US as the new global leader!
Japan is on declining phase but then again, quality of life is so good, i don't think japanese even bother! I mean, Japan is world No.1 in quality of life, innovations have taken a back seat! So what! As if Japan care at all!
Anyway, this oil surge will probably last 2 years or so before oil glut once again takes over! So enjoy the ride!
06/10/2021 11:33 AM

Sapura Energy emerges as most active stock on RM2.64b contract wins

Author: acinanatucer   |  Publish date: Fri, 1 Oct 2021, 4:20 PM


Sapura Energy Bhd emerged as one of the most actively traded stocks on Bursa Malaysia in the early session today, as the group announced that it had secured contracts worth RM2.64 billion.

At 10.31am, the counter saw 100.67 million shares changing hands, although the shares eased half-a-sen to 11 sen.

In a filing with Bursa Malaysia yesterday, the group said the contracts were for works in Australia and Brazil.

Meanwhile, Kenanga Research said Sapura Energy is faced with project execution delays, primarily in Taiwan and India due to the current impact of the pandemic on its operations,

“This is further exacerbated by liquidity concerns with the group’s vendors and clients, further hampering its job execution ability.

“Management is expecting these challenges to continue to persist throughout the second half of 2022.

“Additionally, during the second quarter of financial year 2022 (Q2 2022), all of its long-term debt was reclassified into short-term debt — amounting to RM10.9 billion — due to breach of financial covenants.

“Its net-gearing ballooned to 1.3 times during the quarter, from 1.1 times in Q2 2021,” it said in a research note today.

It noted that Sapura Energy is hopeful of receiving a waiver from lenders for the breach, which will see the borrowings reclassified as long-term debt in the coming quarter. - Malay Mail

 

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Qatargas starts latest North Field Expansion race, triggering contractor battle

Author: acinanatucer   |  Publish date: Fri, 1 Oct 2021, 3:33 PM


 

Up to five leading international contracting giants are poised for an almighty scrap over a prized offshore contract from Qatargas to provide offshore infrastructure for the second phase of its giant North Field Expansion liquefied natural gas project.

The state-owned giant recently invited bids for up to five offshore jackets required for the North Field South (NFS) project — the second expansion phase of the giant gas field — three people with direct knowledge of the development told Upstream.

“Tenders documents have been issued and bids are likely to be submitted by end of October,” one of them said.

The offshore project includes the engineering, procurement, construction and installation of five sizeable offshore wellhead jackets destined for the NFS project.

Those expected to submit bids include McDermott International of the US, Italy’s Saipem and Rosetti Marino, Indian engineering giant Larsen & Toubro and Malaysia’s Sapura Energy, project watchers said.

Qatargas is a subsidiary of state-owned giant Qatar Petroleum (QP) and is carrying out the tender process for multiple onshore and offshore projects involving the giant expansion scheme.

QP is yet to respond to an Upstream query seeking details on the NFS tender process.

 

Workscope details

The NFS project development envisages adding "new offshore wells and infrastructure including wellhead platforms, pipelines and onshore facilities to boost LNG production for export,” according to pre-qualification documents seen by Upstream.

One project watcher described the NFS offshore jackets as substantial structures, with each likely to weigh more than 3500 tonnes.

The NFS scheme will be adding 50 wells on the five offshore platforms that are likely to be located about 20 kilometres to 30 kilometres from Ras Laffan, in water depths ranging between 18 and 24 meters in the North Field, Upstream understands.

The five WHPs will produce feedstock for the two new mega-trains and will be connected through an infield pipeline into a trunkline.

 

Expansion phase

The NFS project aims to increase Qatar’s LNG production capacity to 126 million tonnes per annum by 2027 and is expected to cost billions of dollars.

QP is progressing swiftly with the field’s first expansion phase — North Field East (NFE) — which will raise Qatar’s LNG production capacity from 77 million tpa to 110 million tpa by 2025.

This year, QP announced the final investment decision for NFE, valuing it at around $28.75 billion.

Project watchers have indicated that the second phase, which plans to add two additional liquefaction mega-trains, could be valued at between $15 billion and $20 billion.

 

North Field East project

A trio of offshore contractors or consortia are battling it out for the Qatargas NFE EPCI contract, Upstream understands.

This workscope comprises at least eight new unmanned wellhead platform topsides.

In addition, up to five additional wellhead topsides meant for NFS could also be included as an option, project watchers said.

Those said to be among the bidders include McDermott, South Korea's Hyundai Heavy Industries and a grouping of Saipem with Sembcorp Marine.

Last year, Qatargas issued the tenders for the two offshore packages for North Field's first expansion phase.

In addition to the topsides packages, contractors are battling it out for a second package that involves subsea pipelines meant for NFE.

This includes the EPCI of more than 500 kilometres of subsea pipelines and up to 300 kilometres of subsea cables.

For the pipelines package, McDermott, Saipem and Switzerland-based Allseas are said to be in the fray.

McDermott is also working on the EPCI contract involving multiple offshore jackets for the NFE project.

 

 

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Sapura Energy's indirect units bag contracts worth RM2.64 bil in Australia, Brazil

Author: acinanatucer   |  Publish date: Fri, 1 Oct 2021, 3:30 PM


 

Sapura Energy Bhd’s indirect wholly-owned subsidiary and joint venture in engineering and construction (E&C) have been awarded contracts in Australia and Brazil with combined values of approximately RM942 million and RM1.7 billion, respectively.

In Australia, Sapura Projects Pty Ltd has been awarded a contract for Spartan & SHUR Transportation and Installation Works by Santos WA Northwest Pty Ltd.

The scope of work comprises installation of clamps and J-tubes on the John Brookes wellhead platform followed by installation of two subsea umbilicals and one flowline, along with mattresses at crossings.

“The work is to be performed over two campaigns in the first and fourth quarter of the calendar year 2022 and is expected to be completed by the fourth quarter of the calendar year 2022,” Sapura Energy said in a filing with Bursa Malaysia today.

Sapura Projects Pty Ltd was also awarded by Santos WA Northwest Pty Ltd with a contract for front end engineering design (FEED) for the design, construction and installation of the wellhead platform for the Dorado project in the Bedout Sub-basin, offshore Western Australia.

The contract scope of work includes design, construction, engineering, fabrication, transportation and installation of the wellhead platform.

The works are expected to be completed by the first quarter of the calendar year 2024, it said.

In Brazil, Sapura Navegação Marítima SA, a wholly-owned subsidiary of Seabras Sapura Participações SA, a joint venture company between Sapura Offshore Sdn Bhd and Seabras Serviços De Petroleo SA, a subsidiary of Seadrill Ltd, has been awarded with charter and service contracts for the operation of pipe laying support vessels (PLSVs), Sapura Diamante and Sapura Topazio, by Petrobras.

The contract's scope of work includes the provision of services and charter of installation and recovery of flexible pipes by utilising the PLSVs in Brazilian waters.

The PLSVs shall perform all operations required for the installation of flexible pipes, electric-hydraulic umbilical and power cables, new or used, such as loading, unloading, laying, connection between spans, vertical connection (first and second end) on submarine equipment, installation of submarine equipment and hydrostatic test, in a maximum water depth of 3,000 metres.

The contract duration for Sapura Diamante and Sapura Topazio is 3.5 years and they will commence work on Oct 1, 2021, and Jan 31, 2022, respectively.

Labels: SAPNRG
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Local O&G stocks heat up as oil price hovers at 3-year high

Author: acinanatucer   |  Publish date: Thu, 30 Sep 2021, 11:59 AM


Shares of Malaysian oil and gas (O&G) companies saw renewed interest this week, as international benchmark Brent crude temporarily topped the psychological barrier of US$80 per barrel on Tuesday due to rising energy undersupply concerns.

The Bursa Malaysia Energy Index retreated slightly on Wednesday after a two-day jump as oil prices hit a three-year high. However, the index is still up 4.82% from last Friday’s closing.

Week-to-date, the sector’s top active counters included Dagang NeXchange Bhd, KNM Group Bhd, Serba Dinamik Holdings Bhd, Bumi Armada Bhd and Sapura Energy Bhd. Top gainers during the period included Petronas Dagangan Bhd, Yinson Holdings Bhd and Hengyuan Refining Co Bhd.

Oil prices have been buoyed by the rally in natural gas and coal ahead of the winter season and as global economic recovery is expected to fuel demand. A drop in US oil inventories, which are at their lowest levels since 2018, has helped drive oil prices higher.

According to industry observers, the sustainability of oil prices at this level will depend on how soon Covid-19 becomes endemic and the global economic engine could ride a smoother recovery path.

Oil bulls may also point to some countries having been slow to match the Organization of Petroleum Exporting Countries’s quota to add another 400,000 barrels per day until end-2021 due to under-investments in the last decade.

Goldman Sachs has raised its year-end forecast to US$90 per barrel from US$80 per barrel previously, while global trading firm Trafigur sees oil trading higher to US$100 in late-2022 citing global demand recovery.

Refinitiv Oil Research (Asia) director Yaw Yan Chong, when contacted, is slightly more conservative. He pointed to the aftermath of Hurricane Ida in the US, which has knocked out sizable crude output from the Gulf of Mexico.

This is notably so from the region’s largest producer, Shell, which has lost about 40% of its production capacity, or 28 million barrels, and which will only be fully restored early 2022, Yaw told theedgemarkets.com.

“However, output is gradually being restored, and I don’t think this should be a reason for prices to hit the US$80 per barrel mark. If it does, it will be because of sentiment, not fundamentals,” said Yaw.

“Demand from Asia, if anything, remains on the wane and under pre-pandemic levels, with the region’s major economies all still under some form of lockdown or other, and China’s oil imports being curbed by government restrictions.

“We expect some uptick to crude imports from September and for the rest of 4QCY21 amid the peak demand winter, as reflected by September imports notionally assessed at 101.43 million tonnes, the highest since March, but still well below pre-pandemic levels,” Yaw said.

He added that refineries in three of Asia’s top four centres — India, South Korea and Japan — are also running at below average capacity levels and are likely to stay that way for the rest of the year, with August capacity utilisation at between 76% and 87%.

Further, Yaw sees little link between oil and power generation.

“The alternative power-generation fuel to gas is actually fuel oil, a bottom-of-the-barrel residue, whose production and potential for increase in yield are usually limited as its margins are usually negative.

“Fuel oil is also normally used as marine fuels, and the fuel oil market has indeed tightened in the wake of this surge in power-generation demand; but it is unlikely to lead to an increase in refinery runs, or consequently, an uptick in crude demand,” he said.

Mixed report card keep O&G shares suppressed

For local O&G services players, what matters is the assumption of oil majors and national oil companies — who have remained largely conservative on planning basis — and in turn, in their capital investments.

While the current elevated oil price extended an over 110% gain seen from around US$37 per barrel in November 2020, shares of local services companies had not tracked the impressive rally.

Bursa Malaysia’s Energy Index had come off its 10-month low on Sept 22, and just a few counters are trading close to their one-year highs as Covid-19 lockdowns and operating procedures subdued earnings.

The index is still down 37% from its pre-pandemic levels — in part due to the steep 78% decline in the share price of former industry darling, Serba Dinamik, amid audit concerns faced by the company earlier this year.

AmBank Research in its Sept 7 note said capital expenditure (capex) by national oil firm Petroliam Nasional Bhd (Petronas) in the first half of 2021 (1H21) appears to be below its capex plans at RM12.7 billion, which accounts for 28%-32% of its annual target of RM40-45 billion.

Citing mixed report cards in 2Q2021 among companies under its review, the research house, however, maintained ‘overweight’ on the sector, citing improving balance sheet, compelling valuation and dividend yields, and improved industry prospects for select counters.

HLIB Research, in its note dated Sept 2 is expecting Petronas to ramp up its capex spending in 2H2021 “as its financial performance has improved significantly and this is expected to benefit most O&G services companies in Malaysia”.

For RHB Research, it has an “overweight” stance on the O&G sector as it sees exploration and production and petrochemical companies continuing to enjoy a strong recovery in earnings this year — riding on better commodity prices — while services players should gradually benefit from higher domestic capex allocations.

Its top picks are MISC Bhd, Petronas Chemicals Bhd and Bumi Armada Bhd.

In its Sept 29 report, it increased its Brent crude oil price projections for 2021 and 2022 to US$71 per barrel and US$69 per barrel respectively from US$68 and US$65 per barrel previously, while maintaining its long-term crude oil price forecast at US$60 per barrel.

One company that will post their financial results on Thursday (Sept 30) is integrated upstream group Sapura Energy Bhd for its second financial quarter ended July 31, 2021 (2QFY22). The group remained in the red in 1QFY22, posting a net loss of RM97.07 million, and analysts are largely mixed on whether this is a turnaround year for the company.

In hindsight, local O&G companies performed well in terms of earnings and share price in 2019 when oil prices stabilised at US$60-70 per barrel range, with share prices rising 60% in that year. With Brent averaging at US$67 per barrel year-to-date, it certainly spells hope for the O&G players.

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calvintaneng Oil and Gas depends on Petronas job award out for 2022

So oil and gas will only see profits from Mid 2022 onwards long time more

Palm oil going to report fantastic result by Nov 2021

And many will spring surprises
30/09/2021 12:04 PM
acinanatucer Hmm it doesn't necessarily depends on Petronas jobs.
OG companies are looking out at job outside malaysia.
Sapura is bidding for Qatar jobs. Serba Dinamik is in Abu Dhabi.
Focus is not only on local market
01/10/2021 4:22 PM

Sapura Energy, Hibiscus mungkin perlu sokongan Petronas untuk terlibat dalam teknologi hidrogen

Author: acinanatucer   |  Publish date: Thu, 23 Sep 2021, 2:41 PM


 

 

Petronas Chemicals Group Bhd. dan Petronas Gas Bhd. dilihat akan mendapat kelebihan daripada pembangunan bekalan hidrogen bersih yang dimeterai antara Petronas dan ENEOS Corporation (ENEOS) baru-baru ini. 

Perjanjian tersebut yang membabitkan anak syarikatnya, Petronas Gas & New Energy Sdn. Bhd. (PGNESB) dan ENEOS yang berpangkalan di Jepun itu bakal menyaksikan kedua-dua pihak melaksanakan kajian teknikal-komersial bersama dalam rantaian bekalan hidrogen. 

Selain itu, ia juga termasuklah pengeluaran dan pengangkutan dalam bentuk methylcyclohexane (MCH), iaitu hidrogen ditukarkan dari bentuk gas asli kepada cecair bagi membolehkan penghantaran dilakukan dalam jumlah lebih besar.

Penganalisis AmInvestment Bank Bhd., Alex Goh berpendapat, kedua-dua anak syarikat Petronas ini memiliki keupayaan dari segi infrastruktur dan kedudukan kukuh untuk memulakan pelaburan dalam pengeluaran gas asli kepada hidrogen, sekali gus mempelbagaikan aliran pendapatan. 

Pada masa sama, katanya, penyedia perkhidmatan sokongan seperti Dialog Group Bhd., yang membina terminal gas asli cecair (LNG) di Pengerang dan menyediakan kepakaran penyelenggaraan loji, juga mempunyai keupayaan untuk menyertai rantaian nilai ini. 

"Bagaimanapun, bagi pengendali penerokaan dan pembangunan seperti Sapura Energy Bhd. dan Hibiscus Petroleum Bhd. yang menghasilkan gas asli, kami tidak nampak penglibatan mereka dalam tempoh terdekat ini dalam teknologi peringkat awal ini, yang mungkin perlu ditanggung oleh Petronas dengan kemampuan, imbangan tunai dan sokongan kerajaan yang lebih kuat.

"Begitu juga dengan penyedia perkhidmatan lain yang lebih kecil seperti KNM Group Bhd., meskipun mungkin mempunyai kepakaran membuat kapal dan peralatan pemprosesan, kami tidak yakin dengan kemampuan kewangan mereka pada masa ini," katanya dalam nota kajian hari ini.

Menurut beliau, pembangunnan bagi teknologi pembawa cecair organik hidrogen semakin mendapat daya tarikan berikutan sifat kimianya yang stabil membolehkan penyimpanan jangka panjang dan pengangkutan jarak jauh serta memanfaatkan infrastruktur petrokimia dan minyak sedia ada.

"Ini secara tidak langsung dapat mengelakkan daripada membangunkan aset baharu, sebaliknya berupaya meningkatkan daya saing dari segi kos, skala dan paling penting kemampuan kewangan bagi pemain industri tenaga yang mapan," jelas beliau.

Menerusi perjanjian itu, Petronas dan ENEOS akan meneroka pengeluaran hidrogen berkarbon rendah menerusi kemudahan petrokimia Petronas dan pada masa akan datang, hidrogen hijau dihasilkan oleh tenaga boleh diperbaharui (RE).

Perkembangan teknologi hidrogen organik cecair (LOHC) seperti MCH mendapat tarikan pantas kerana sifatnya stabil secara kimia yang membolehkan ia disimpan untuk jangka panjang dan diangkut secara jarak jauh.

Bagi projek dengan Petronas, ENEOS sudah mengemukakan pembiayaan daripada Dana Inovasi Hijau Kerajaan Jepun yang menaja projek dan inisiatif penyahbekuan.

MoU itu juga dilihat melengkapkan aspirasi bersama Petronas dan ENEOS untuk mencapai pelepasan karbon sifar bersih menjelang 2050.

Secara keseluruhan, AmInvestment mengekalkan saranan 'overweight' ke atas sektor minyak dan gas. Firma itu meletakkan saranan 'beli' ke atas saham Dialog, Yinson Holdings Bhd., Sapura Energy dan Petronas Gas. 

 

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Sapura Energy CFO resigns to pursue other opportunities

Author: acinanatucer   |  Publish date: Wed, 22 Sep 2021, 9:41 AM


Sapura Energy Bhd said its group chief financial officer (CFO) Reza Abdul Rahim will be stepping down effective Oct 1, to pursue other opportunities.

Reza joined the group in 2012 as senior vice president of the offshore construction and subsea services division in 2012, and was subsequently appointed as group CFO in June 2016.

“Reza is an integral part of the Sapura Energy growth story. He helped to build the group into the global integrated energy services and solutions provider that we are today,” said Sapura Energy group chief executive officer Datuk Anuar Taib in a statement.

He said Reza played a pivotal role in enabling the group to gain assets and capabilities in engineering and construction, drilling and exploration and production.

Reza also spearheaded efforts to strengthen the group’s financial position, including the previous rights issue and the recent refinancing exercise, said Anuar.

Meanwhile, Sapura Energy said its vice president, group controller Andy Chew will serve as acting group CFO following Reza’s departure.

Sapura Energy’s share price closed unchanged at 11.5 sen, giving the group a market capitalisation of RM1.84 billion.

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Commodities on a rebound

Author: acinanatucer   |  Publish date: Tue, 21 Sep 2021, 10:45 PM


COMMODITIES started off the year with a bang as the Bloomberg Commodity (BCom) Index, which tracks the prices of 23 raw materials, reached new highs since 2011 and touched 97.51 points on July 29.

On Aug 20, however, the index slumped 7% to 91.16 points, on anticipation of slower economic growth amid expectations of a reduction of asset purchases by the US Federal Reserve. It has since made up some lost ground, closing at 95.79 points last Tuesday, as prices of heavyweight commodities that make up the index, such as oil and gold, picked up steam.

“Commodity prices have continued to climb during the past three months, but while the rally during the first part of 2021 was synchronised across all sectors, we are now seeing some sectors sticking out relative to others,” Saxo Bank head of commodity strategy Ole Sloth Hansen tells The Edge.

 
 

Here, we take a look at the performance of some of these commodities over the past three months.

Brent crude, CPO prices continue to climb

The prices of two commodities vital to the Malaysian economy — Brent crude oil and crude palm oil (CPO) — continued to display resilience amid the pandemic. Brent crude oil prices have increased 39% year to date, to US$72 per barrel last Monday. Compared with three months ago, the price of the energy commodity has inched up by a marginal 1%.

Saxo Bank’s Hansen says Brent crude oil has settled into a wide mid-US$60 to mid-US$70 range, with continued demand concerns related to the Covid-19 pandemic offset by Opec+ keeping a lid on production increases to ensure that the market remains balanced but not oversupplied.

“We maintain a positive outlook for crude oil in the belief that global consumption will continue to recover and Opec+ will continue to actively manage supply to support prices. Key risks to this assumption is a renewed surge in Covid-19 cases and a stronger-than-expected recovery in non-Opec+ production, especially from US shale producers that have shown a great deal of discipline by turning their focus to profitability instead of the previous pump-baby-pump attitude.

“Provided we see no major surprise from these two, I see Brent making an attempt to reach US$80 per barrel before year-end, before settling into a US$70-to-US$80 per barrel range in 2022,” says Hansen.

AmInvestment Bank in a Sept 7 note says it is maintaining its forecasts for oil prices in 2021/22 at US$65 to US$70 per barrel. The firm has an “overweight” call on the Malaysian oil and gas sector, with Dialog Group Bhd and Sapura Energy Bhd among its top picks.

Prices of CPO futures contract have shot up 8% in the past three months, from RM4,123 per tonne on June 8 to RM4,435 per tonne last Monday.

Singapore-based independent online publisher of palm oil market news Palm Oil Analytics owner and co-founder Dr Sathia Varqa says CPO prices, which had eased in July after hitting an all-time high of RM4,524 per tonne in May, have started to trend higher again in August.

“This was mainly on external support of firm soybean oil prices and a lower annual palm production outlook. CPO prices are highly volatile this year, dragged higher by weak supply and a sporadic rise in export demand,” he adds.

Sathia expects CPO futures to remain above RM4,000 per tonne until year-end, driven by the rebound in September exports and relatively better export pricing compared with main competitor Indonesia, which hiked its export levy on September shipments.

In a Sept 7 outlook on the plantation sector, Hong Leong Investment Bank Research (HLIB Research) says the share price of plantation companies, which are represented by the Bursa Malaysia plantations index, still lags behind the rally in CPO prices, owing to lingering environmental, social and governance (ESG) concerns within the sector, and doubts over the sustainability of CPO prices.

“We believe the concerns on ESG issues have already been reflected in the sector’s valuations, as most players — particularly the large ones — have been putting efforts into rectifying these ESG issues,” the firm says, noting that multi-year low levels of foreign shareholdings in these companies also underscore the concerns.

Nevertheless, HLIB Research upgraded its sector call from “neutral” to “overweight”. IOI Corp Bhd, Kuala Lumpur Kepong Bhd, Sime Darby Plantation Bhd and TSH Resources Bhd are among its top picks.

“While we maintain the view that current high CPO prices will not [be sustained] over the longer term, we upgrade the sector to ‘overweight’, as we believe a rerating is warranted on the sector’s palatable valuations and good near-term earnings prospects arising from elevated CPO prices,” the firm says.

 

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Brighter outlook for Malaysia’s oil and gas sector

Author: acinanatucer   |  Publish date: Mon, 20 Sep 2021, 11:18 AM


 

RISING global oil prices amidst increasing Covid-19 vaccination rates and anticipated higher world economic growth rates in 2022 are brightening the outlook for Malaysia’s oil and gas sector, say research analysts.

According to the Organisation of the Petroleum Exporting Countries (Opec) in its latest monthly oil market report, world oil demand is projected to hit 100.8 million barrels per day (bpd) in 2022, exceeding pre-pandemic levels.

 

This is compared against global oil demand in 2021, which is now projected to average 96.7 million b/d.

“As vaccination rates rise, the Covid-19 pandemic is expected to be better managed and economic activities and mobility will firmly return to pre-Covid-19 levels. Steady economic developments are expected to support the partially delayed recovery in oil demand in various sectors,” said the cartel.

 

Opec pointed out that United States growth is forecast at 6.1% in 2021, supported by unprecedented fiscal and monetary stimulus, followed by projected growth of 4.1% in 2022, with further potential upside that may come from additional fiscal stimulus.

 

Growth in the eurozone has also picked up strongly, especially in the second quarter of 2021, with economic growth for the entire year forecast at 4.7%, followed by 3.8% in 2022.

Meanwhile, China’s first half of 2021 (H1’21) gross domestic product (GDP) figures confirmed a stable economic recovery, albeit the renewed Covid-19 variant outbreak is forecast to limit 2021 growth at 8.5%.

“China’s anticipated softening of the H2’21 growth momentum is forecast to continue into 2022, leading to growth of 6%. India’s growth is forecast at 9% for 2021 and 6.8% in 2022,” said the cartel.

Meanwhile, Opec noted that global oil demand in the third quarter of 2021 (Q3’21) has proved to be resilient, supported by rising mobility and travelling activities, particularly in the Organisation for Economic Co-operation and Development (OECD).

However, H2’21 global oil demand has been adjusted slightly lower, partially delaying the oil demand recovery into H1’22 due to the increased risk of Covid-19 cases primarily fuelled by the Delta variant, clouding oil demand prospects going into the final quarter of the year, resulting in downward adjustments to Q4’21 estimates.

Meanwhile, AmInvestment Bank Research maintains its “overweight” call on the oil and gas sector, and says it likes Dialog Group Bhd for its resilient non-cyclical tank terminal and maintenance-based operations, as well as Yinson Holdings Bhd’s strong earnings growth momentum from the full-year contributions of floating production storage and offloading (FPSO) vessels Helang, off Sarawak, Abigail-Joseph in Nigeria and Anna Nery in Brazil, plus multiple charter opportunities in Brazil and Africa.

 

The research unit noted that Yinson had recently signed a memorandum of understanding (MoU) to supply a mid-sized FPSO vessel to Enauta’s Atlanta field in Brazil.

AmInvestment Bank Research also likes Sapura Energy Bhd as its completed RM10bil debt restructuring package positions the formidable engineering, procurement, construction, installation and commissioning (EPCIC) group to secure fresh global orders.

“Meanwhile, Petronas Gas Bhd offers highly compelling dividend yields from its optimal capital structure strategy and resilient earnings base,” said the research unit.

AmInvestment Bank Research is maintaining its 2021 to 2022 oil price projection at US$65 to US$70 (RM271 to RM292) per barrel as Brent crude oil prices have recovered above US$70 (RM292) per barrel currently after falling to US$65 (RM271) per barrel on Aug 20 this year on concerns that the Covid-19 Delta variant could dampen global demand.

The research unit said while United States shale production could rebound and Opec may continue to raise production quotas against the backdrop of the brighter oil price environment, this could be mitigated by rising global demand on the back of Covid-19 vaccine rollouts in H2’21.

However, AmInvestment Bank Research pointed out that the pandemic had impacted Q2’21 order flows to Malaysian oil and gas operators.

“Contract rollouts are still being impacted by the global pandemic, movement restrictions and energy transition policies, which caused Q2’21 awards to decrease 33% quarter-on-quarter to RM2.2bil,” said the research unit. It pointed out that while new contract awards in H1’21 to Malaysian oil and gas operators (excluding Serba Dinamik Holdings Bhd in light of its accounting issues raised by its former auditor) rebounded 2.6 times year-on-year to RM5.6bil, largely from multiple jobs awarded to Sapura Energy - the sharp recovery stems from the spending collapse to only RM569mil in Q1’20 due to the earlier Saudi-Russia price war and onset of the Covid-19 pandemic.

This is reflected in Petronas’ H1’21 capital expenditure (capex) decreasing by 14% year-on-year to RM12.7bil mainly due to project delays and rephasing of activities caused by movement restriction orders.

AmInvestment Bank Research noted that H1’21 appears to be below Petronas’ annual capex plans, accounting for 28% to 32% of the national company’s target of RM40bil to RM45bil over the next five years. As a comparison, H1’21 accounted for 33% to 44% of the group’s capex over the past three years.

Petronas plans to spend 55% of the annual capex allocation on domestic investments, with the remainder on international investments.

Meanwhile, KAF Equities’ research unit also maintains its “overweight” call on the oil and gas sector, and favours companies with exposure to the downstream and tanker businesses.

“The upstream service provider subsegment is showing early signs of recovery,” said the research unit, adding Upstream Online news portal had reported that Petronas Carigali is carrying out studies for the potential deployment of a FPSO vessel on its Sepat oilfield offshore Peninsular Malaysia.

While market sources said the concept of an FPSO at Sepat is not new, and there is still no guarantee that it will proceed, KAF Equities said this could still be an opportunity for local FPSO players namely Bumi Armada Bhd, Yinson and MISC due to Petronas previous track record of preference for local service providers.

While the size of the potential project is undisclosed for now, KAF Equities estimates the new FPSO might involve daily production capacity of up to 50,000 b/d range for it to be worthwhile for Petronas to spend on the asset upgrade. Also, the Sepat field is likely to require further development or drilling to boost its production to justify extra capex for the new FPSO.

KAF Equities said for comparison purposes, it believes it would be smaller than recent proposed supply by Yinson of a mid-sized FPSO vessel to Enauta’s Atlanta field in Brazil, indicating that the potential capex for this Sepat project to be US$500mil (RM2bil) to US$600mil (2.5bil) or lower.

“Judging from balance sheet capabilities, we expect MISC and Yinson to be strong candidates if there is a bid, whereas we do not discount the possibility of non-listed players competing as well,” said the research unit.

Hong Leong Investment Bank (HLIB) Research also maintains its “overweight” call on the oil and gas sector, and said its fundamentals are turning positive, with higher oil prices, stronger commitment from Opec+ to keep oil prices afloat, higher impending capex from Petronas in H2’21 albeit not at pre-Covid levels, timeline of vaccine rollouts and the strong economic recovery from China, United States and Europe.

HLIB Research’s top picks are Bumi Armada (buy; target price: 80 sen) for its strong FPSO business and fast improving balance sheet and Dialog (buy; target price: RM3.45) as the research unit believes that its share price has bottomed out and its growth in sustainable earnings and potential for further expansions for its tank terminals business will provide upside.

The research unit also expects Petronas to elevate its capex spending in H2’21 as its financial performance has improved significantly, and this is expected to benefit most oil and gas services companies in Malaysia.

HLIB Research maintains its Brent crude oil price per barrel forecast at US$70 to US$75 (RM292 to RM313) for 2021 and 2022 as its believes that Opec + is committed to provide a good equilibrium for oil prices.

“Increasing demand from the re-opening of economies globally would neutralise Opec+’s easing of production cuts, providing a stable oil price of around US$70 (RM292) per barrel in 2021,” said the research unit.

However, Kenanga Research maintains its “neutral” call on the sector, saying that undamentals still remain largely weak, with a long-term oil price outlook of US$55 to US$60 (RM229 to RM250) per barrel.

Kenanga Research also noted that Petronas group has recently agreed to increase its financial year 2021 (FY’21) dividends by RM7bil to RM25bil, from RM18bil previously.

“While the group should have no problems meeting this commitment, given its net-cash position of RM60bil – we do note that this is still halved from two years ago (end-2019 net-cash position of RM117bil),” said the research unit.

Kenanga Research also said while upstream is still the largest area of investment for Petronas, it believes this trend of gradually diminishing upstream spending could likely continue, as the group might seek to divert some of its investments into other renewable energy sectors in efforts to keep up with current energy transition trends.

Overall, considering Petronas’ increased dividend commitments and efforts in energy transition, the research unit believes the recovery of activity levels – particularly for local-centric contractors (Velesto Energy BhdUzma BhdDayang Enterprise Holdings Bhd) could still be rather slow.

“Realistically, we do not expect activity levels to revert back to pre-pandemic levels any time before 2023”, said Kenanga Research.

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PETRONAS AND ENEOS SIGN MOU TO DEVELOP MALAYSIA-JAPAN HYDROGEN SUPPLY CHAIN

Author: acinanatucer   |  Publish date: Tue, 14 Sep 2021, 12:01 PM


PETRONAS Malaysia through its subsidiary PETRONAS Gas & New Energy Sdn Bhd (PGNESB), has signed a Memorandum of Understanding (MoU) with ENEOS Corp. (Tokyo, Japan) to jointly develop a competitive, clean hydrogen supply chain between Malaysia and Japan, and to explore other hydrogen opportunities. 

The MoU will see both parties embark on a technical-commercial joint-study of a hydrogen supply chain which includes hydrogen production and its transportation in methylcyclohexane (MCH) form, where hydrogen is converted from its original gaseous state into a liquid form to enable large volume deliveries. 

PETRONAS and ENEOS will also explore low carbon hydrogen production from PETRONAS’ petrochemical facilities and in the future, green hydrogen produced by renewable energy. 

“We are proud to expand our three-decade long energy partnership with ENEOS to include hydrogen, on top of what we have established in the liquefied natural gas (LNG) space. More importantly, this partnership is a testament of how industry collaboration can help accelerate our shared aspiration towards a low carbon future,” said PETRONAS Gas + New Energy Executive Vice President and Chief Executive Officer Adnan Zainal Abidin. 

“With emerging clean energy sources like hydrogen, innovation and collaboration with partners in technological development are key, as they contribute towards achieving cost competitiveness and scalability for wider use across businesses and industries,” he added. 

The development of liquid organic hydrogen carrier (LOHC) technology such as MCH is fast gaining traction due to its chemically stable nature that allows for long-term storage and long-distance transport. Moreover, the use of LOHC leverages on existing conventional oil and petrochemicals infrastructure which heavily reduces the need to develop new assets, thus making it a viable option for established energy players to implement.

For this project with PETRONAS, ENEOS has applied for funding from the Japanese Government’s Green Innovation Fund which sponsors decarbonization projects and initiatives. While in Malaysia, the development of a hydrogen-based economy is set to complement future growth as the country prepares to transition towards a low carbon economy. 

The MoU stems from both PETRONAS’ and ENEOS’ common aspiration of achieving net zero carbon emissions by 2050. In 2020, PETRONAS announced its intent to achieve Net Zero Carbon Emissions by 2050 as part of its holistic approach towards sustainability, while ENEOS is working towards achieving its carbon neutral ambition via its Environmental Vision 2040. 

PETRONAS already produces low-carbon hydrogen from its facilities and will soon explore the commercial production of green hydrogen. PETRONAS is well-poised to be a competitive hydrogen solutions provider due to its inherent geographical advantage, in addition to the expanding renewables portfolio, strong partnerships with customers and technology partners. 

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Handal Energy receives offshore crane maintenance contract extension from SEA Hibiscus

Author: acinanatucer   |  Publish date: Mon, 6 Sep 2021, 12:00 PM


 

Handal Energy Bhd's wholly-owned subsidiary, Handal Cranes Sdn Bhd, has received a letter of extension from SEA Hibiscus Sdn Bhd to extend the company's offshore crane maintenance services.

In a statement today, the oil and gas integrated services provider said the new agreement extends Handal Crane's original contract with SEA Hibiscus to provide offshore crane maintenance services from October 31, 2021, until October 30, 2022.  

There is no specified value to the contract extension. It is running on a 'call-out' basis in which SEA Hibiscus will issue a work order to Handal Crane based on their activities schedule and rates throughout the contract duration.

Handal group managing director Sunildeep Dhaliwal said the company has been supporting SEA Hibiscus operations since 2019.

"The extension of this contract will contribute positively to our earnings for the financial year ending June 30, 2022.

"Handal returned to profitability in the financial year ended June 30, 2021, and we will continue to ensure business sustainability and profitability, with more project tenders in the pipeline," he said.

SEA Hibiscus is the wholly-owned subsidiary of Hibiscus Petroleum Bhd, Malaysia's first listed independent oil and gas exploration and production company.

Since March 31, 2018, SEA Hibiscus has been the operator of the 2011 North Sabah Enhanced Recovery Production Sharing Contract (PSC), the first asset of Hibiscus.

The responsibilities of SEA Hibiscus as the PSC's operator include managing the extraction of oil from four existing oil fields, St Joseph, South Furious, SF30 and Barton, as well as managing the Labuan Crude Oil Terminal, existing pipeline infrastructure, and all other equipment and assets relating to the PSC.

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Petronas said to have good 2Q21

Author: acinanatucer   |  Publish date: Thu, 26 Aug 2021, 2:52 PM


PETROLIAM Nasional Bhd’s (Petronas) second-quarter 2021 (2Q21) earnings look set to get a boost from higher energy prices, barring major impairments and production cuts as a result of the Covid-19 pandemic.

The national oil company is scheduled to announce its results tomorrow and based on recent strong results of oil majors like Royal Dutch Shell plc and British Petroleum plc, Petronas’ upstream business — which accounts for about 60% of earnings every year — is set to drive the growth in profits for the quarter.

Putra Business School Assoc Prof Dr Ahmed Razman Abdul Latiff said the higher average crude oil prices during the quarter of about US$70 (RM296.97) per barrel compared to around US$45 per barrel in 2Q20 and higher natural gas prices are set to power Petronas’ quarter performance despite the negative impact of the stronger ringgit in the quarter on a year-on-year (YoY) comparison basis.

“Crude oil is higher and natural gas prices are almost at a peak now (around US$4 compared to US$2 last year). However, I don’t think the prices will continue to be high and will stabilise at a lower level in the next few months,” he told The Malaysian Reserve (TMR).

With the Malaysian market accounting for about a third of its total earnings, the 2Q results of its downstream listed companies such as Petronas Chemical Group Bhd, Petronas Dagangan Bhd, Petronas Gas Bhd and MISC Bhd have generally improved YoY based on their respective exchange filings.

The growth in 2Q earnings is likely to be strong on a YoY basis considering Petronas registered a quarterly net loss at RM21 billion in the 2Q20 dragged by huge impairments on assets.

Group revenue for the 2Q last year dropped 42% to RM34 billion from RM59.1 billion recorded in 2Q19 mainly due to lower average realised prices for major products and lower sales volume especially from petroleum products, liquefied natural gas (LNG) and processed gas.

Petronas made a net profit of RM9.3 billion in 1Q21 after posting earnings of RM4.5 billion in 1Q20.

The company had said the higher 1Q21 profit was backed by lower overall group costs incurred which partially offset lower revenue in the period.

Revenue for the quarter, however, dropped 12% YoY to RM52.5 billion due to lower sales volume of petroleum products, LNG and natural gas, coupled with the effect of a stronger ringgit against the US dollar.

An analyst with MIDF Research said natural gas prices globally had increased compared to last year and expected to average at US$3.42 per million British thermal units (mmBtu) for 2021 compared to US$2.03/ mmBtu in 2020.

According to the analyst, recently, Gas Malaysia Bhd had expected an average natural gas selling price for distribution to RM30.03/mmBtu, slightly below the average natural gas selling price of RM33.65/mmBtu last year.

“These may be reflecting the growth in LNG exports and rising natural gas consumption for sectors other than electrical utility. Tighter supply for LNG and natural gas, lower European production and lower exports from Russia had caused the recent high commodity prices.

“Demand for natural gas has been on a strong rebound globally under varying factors — economic recovery from seasonal peaks, extreme weather conditions reducing the capacity of other electrical generators, and depleted gas storage from long winters in need of replenishment,” the analyst told TMR.

As long as supply remains in a crunch and demand for gas for power generators recovers, the price will continue to be high, both globally and locally, said the analyst.

The analyst believes the financial performance of oil and gas (O&G) companies for 2Q21 or the first half of 2021 (1H21) will be less impacted by the current drop in crude oil price.

“Financial performances for O&G companies with diverse business segmentation and resilient orderbook are expected to perform better for 2Q21, as are service companies with awarded projects and ongoing projects to be delivered in 2Q21.

“Additionally, O&G companies had started to adhere to sustainable environmental, social and governance activities and projects as a way to compensate for earning losses in 2020 and 1Q21,” the analyst said.

The analyst said the outlook for the O&G sector for the 2H21 will continue to be beset by uncertainties and volatility in prices.

Brent oil price began to drop in early August after OPEC commenced its supply output rise to 400,000 barrels per day which is expected to remain until the end of 2022.

Demand for energy products, however, is set to increase amid global vaccination rollouts (30.7% of the world population has received at least one dose of a Covid-19 vaccine, and 16% is fully vaccinated) and reopening of borders, said the analyst.

“Taking into context the near-term impact of the Delta virus variant, OPEC+ supply output and the business mitigation movement, we opine the oil market will most likely trade in the price range of US$60 per barrel to US$75 per barrel in 2H21. We also maintain our outlook for Brent crude oil price average of US$62 a barrel in 2H21,” the analyst said.

Petronas looks set to see out a much stronger 2021 financial year.

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Sapura Energy Bhd and EVN GENCO 3 cooperate to develop wind power in Vung Tau, Vietnam.

Author: acinanatucer   |  Publish date: Thu, 26 Aug 2021, 2:08 PM


Electricity of Vietnam (EVN) and HBRE Group, an investor in the development of an onshore wind farm with a total capacity of 400mw in Vietnam, have signed a cooperation agreement to develop another wind farm offshore Duyen the southern coast of Vietnam. They are being supported in the feasibility assessment of this project by Sapura Energy Bhd (Malaysia), a globally integrated offshore engineering and construction company.

HBRE currently has four onshore wind farm projects at different stages of development, while this will be the first offshore wind farm.

Mr. Ho Ta Tin, Chairman of HBRE said: “EVN's presence in this project shows EVN's trust and commitment to the renewable energy sector, and we believe that construction experience Sapura Energy's offshore wind farm in the energy sector, especially in the field of transportation & installation for offshore wind farms, will achieve the highest efficiency.”

The offshore wind energy field has been interested by HBRE and proposed investment survey ideas with the first project in Binh Thuan in 2016. However, at this time, the investment rate is quite high while the selling price is high. Wind power is at a low level. Therefore, despite seeing great potential from La Gan cape, HBRE had to temporarily put aside the investment in this locality.

By 2019-2020, the Vung Tau offshore wind power plant project invested by HBRE Group is the first and largest offshore wind power project in this locality with a total investment of more than 1 billion USD, with a capacity of 500MW. .

The project is located in the offshore sea about 35km from the shore of Binh Chau commune, Xuyen Moc district, which has been approved by the People's Committee of Ba Ria - Vung Tau province for research, survey, survey, measurement, and project proposal. May 2019.

The People's Committee of Ba Ria - Vung Tau province has submitted a document to the Prime Minister and the Ministry of Industry and Trade to appraise and add the offshore wind power plant project HBRE Vung Tau to the national electricity development planning in November 2019.

Up to now, the Ministry of Industry and Trade has completed the consultation with relevant ministries and sectors and is submitting to the Government to add this project to the power planning VIII.

The projects that HBRE Group has, is and co-invests in and develops include: Wind power farm in Dak Lak (30MW); HBRE Chu Prong Wind Power Farm (phase 1) with a capacity of 50MW, scheduled to be put into operation by October 31, 2021. In addition, in Ha Tinh, HBRE invests in a 120MW wind power project in Ky Anh district; 200MW wind power project in Phu Yen. Currently, these two projects are waiting to be cleared of legal procedures and land for investors to start construction as soon as possible. According to Mr. Ho Ta Tin, Chairman of HBRE Group, in order to encourage wind power investors and create favorable conditions for this field to develop rapidly following the general trend of the world, the Government should consider applying Incentive mechanism for electricity prices for the onshore wind power sector until December 2022 and offshore until December 2025.

 

Labels: SAPNRG
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Sapura Energy wins FEED for Dorado wellhead platform

Author: acinanatucer   |  Publish date: Thu, 26 Aug 2021, 1:14 PM


The wellhead platform will be an unmanned installation, located in 90 metres water over the Dorado oil and gas field, hosting the development wells and gas reinjection wells with minimal processing facilities, remotely operated from a Floating Production, Storage and Offloading (FPSO) facility approximately two kilometres away, Santos said today.

“This contract for the wellhead platform is the project’s last significant commitment as we progress towards a project final investment decision around the middle of next year,” said Santos chief executive Kevin Gallagher.

“The wellhead platform is a critical component of the development requiring a company with Sapura’s deep construction and installation experience. The design allows for the integrated development of both the gas and liquids resource and retains sufficient flexibility to support future exploration success, with the Pavo and Apus prospects to be drilled early next year,” added Gallagher.

“Whilst operating unmanned, the wellhead platform will have several innovative features including sophisticated reservoir performance monitoring functionality to facilitate optimal reservoir recovery,” he said.

Dorado is an integrated oil and gas project which is planned to be developed in two phases. The initial development involves the production of oil and condensate through a wellhead platform and FPSO. Gas will be reinjected in the initial phase to enhance oil and condensate recovery, followed by a planned future phase of gas production to backfill Santos’ domestic gas infrastructure in Western Australia.

“Dorado is a very low CO2 reservoir with approximately 1.5% CO2 and reinjection of gas in the initial phase, making it one of the lowest emission intensity oil projects in the region,” claims Santos.

The project has a Federal Government approved Australian Industry Participation Plan ensuring full, fair and reasonable opportunities for Australian industry to compete for work. This is accessible via the Industry Capability Network website.

Santos has an 80% in the Dorado project and is operator. The remaining interest is held by Carnarvon Petroleum.

Labels: SAPNRG
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Destini bags oil and gas assets service contract

Author: acinanatucer   |  Publish date: Mon, 23 Aug 2021, 12:55 PM


Integrated engineering solutions provider Destini Bhd has secured a contract to provide tubular handling and conductor installation equipment and services from Repsol Oil and Gas Malaysia.

In a statement today, Destini said the two-year job that started on July 21, which comes with an option of a one-year extension, was secured via its wholly-owned subsidiary Destini Oil Services Sdn Bhd. The value of the contract, however, was not revealed.

The group said it is continuing to strengthen and sustain the momentum of its contract wins, and is optimistic of securing more contracts this year as economic recovery gains footing.

“With the award of this contract, the group is currently looking at an orderbook of RM486.63 million for its energy division order book.

“This award is a testament to Destini’s resilience and agility to secure and execute work that is within its core expertise in an uncertain operating environment,” it added.

At market close today, shares of Destini stood unchanged at 16.5 sen per share, valuing the group at RM251.67 million.

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Allseas' renewables foray with its first-ever offshore wind installation

Author: acinanatucer   |  Publish date: Fri, 20 Aug 2021, 11:43 AM


Swiss offshore contractor Allseas made its debut in the offshore wind sector with its giant vessel Pioneering Spirit installing a high-voltage convertor platform for the Saint-Nazaire offshore windfarm development in the Bay of Biscay, offshore France.

Allseas said in a statement Thursday that the project is its "first job for the offshore wind industry" and also the “first complete installation job executed by its vessel Pioneering Spirit".

DEME Offshore had contracted Allseas for the transportation and installation (T&I) of the substation jacket and topsides for Saint-Nazaire.

Focus on windfarms

Leading oil and gas-focused offshore T&I players are increasingly expanding their presence in the lucrative windfarm market, as the energy transition gathers pace.

Several T&I players including Malaysia’s Sapura Energy, Vietnam’s PTSC and Italy’s Saipem are bidding on global offshore windfarm jobs as they look to widen their portfolios and boost their order books, drawing synergies from their existing capabilities in the oil and gas sector.

Giant vessel

The leviathan Pioneering Spirit vessel lifted the 2100-tonne electrical substation safely into place on its jacket foundation on 18 August, having installed the 50-metre tall supporting structure earlier this week, Allseas said.

The contractor said that in addition to playing a “key role in the installation of large transformer stations", the company also sees a future role “in the installation of next-generation turbines and monopiles”, which can greatly benefit from a vessel of the Pioneering Spirit’s capabilities for transportation and installation.

“The speed and ease with which she can transport and install large high-voltage convertor platforms in all conditions make Pioneering Spirit a perfect fit for the offshore wind energy industry,” added Allseas.

Saint-Nazaire, also known as Parc du Banc de Guerande, is the first commercial-scale wind farm in French waters.

The 480-megawatt substation will be the heart of the development, converting the energy generated by 80 turbines and exporting the electricity to the French mainland.

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Sapura Energy unit said to have awarded offshore oil and gas well construction contract to Halliburton

Author: acinanatucer   |  Publish date: Wed, 11 Aug 2021, 2:33 PM


Sapura Energy Bhd’s subsidiary Sapura Drilling is said to have awarded an offshore oil and gas (O&G) well construction contract to US-listed Halliburton Company under a deal that involves the planned building of six O&G wells in collaboration with Sapura Drilling and Petronas Carigali Sdn Bhd.

Halliburton claimed in a statement on its website today that Sapura Drilling, with Halliburton as its technical partner, will execute an integrated rig drilling completion contract for the six-well offshore well construction programme.

"The uniquely integrated nature of the contract opens the pathway for Halliburton, in collaboration with Sapura Drilling and Petronas Carigali, to synergistically deploy its state-of-the-art Halliburton 4.0 digital platform to its fullest potential to achieve a step-change improvement in operational efficiency.

"Digital technologies will include the complete suite of the Digital Well Programme, Digital Well Operations and Digital Well Automation, all DecisionSpace® 365 cloud applications. Consistent with Halliburton 4.0, the scope of work also includes key digital technologies from Sperry Drilling, Cementing, Drill Bits, Baroid, and Completions product lines. 

"The campaign is the first integrated project of its kind in a country that combines rig services with all aspects of planning, operations and automation,”  Halliburton claimed.

Petronas Carigali is the upstream arm of Malaysia national oil company Petroliam Nasional Bhd (Petronas).

At the time of writing today, Sapura Energy and Petronas had not issued statements in response to Halliburton’s statement.

On Bursa Malaysia yesterday (Aug 9), Sapura Energy’s share price closed unchanged at 11.5 sen for a market value of about RM1.84 billion based on the company’s 15.98 billion issued shares.

Labels: SAPNRG
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Tobby So many good news but the price remain stagnant! Strange!
11/08/2021 2:35 PM

Malaysia to Lead Global Gas Output from New Offshore Projects in 2025

Author: acinanatucer   |  Publish date: Wed, 28 Jul 2021, 11:24 AM


 

 

 

Malaysia is expected to contribute about 12% or 3.1 billion cubic feet (bcf) of global natural gas production in 2025 from key offshore planned and announced projects that are expected to start operations between 2021 and 2025, according to data and analytics firm GlobalData.

GlobalData said Monday that that 2.0 bcf of natural gas production in Malaysia in 2025 is expected from planned projects with identified development plans, while 1.0 bcf is expected from early-stage announced projects that are undergoing conceptual studies and are expected to get approval for development.

A total of 19 natural gas projects are expected to start operations in Malaysia during 2021-2025. Of these, Kasawari, Jerun and B14 are some of the key projects that are expected to collectively contribute about 50% of the natural gas production in the country in 2025.

Effuah Alleyne, Oil & Gas Senior Analyst at GlobalData, said: "The oil and gas industry has seen trends shifting towards the need for power sustainability, supported by impacts of the pandemic and governments globally contending with environmental and economic issues. Key themes including renewable energy, decarbonization and clean energy mean that natural gas projects will provide high valued opportunities in the short to mid-term.”

GlobalData identifies Iran as the second highest country globally with 2.70 bcf of natural gas production in 2025 or about 11% of the total global natural gas production in the year. Qatar follows with natural gas production of 2.67 bcf from planned and announced offshore projects in 2025.

Among the companies, Qatar Petroleum, National Iranian Oil Co, and Royal Dutch Shell Plc lead globally with highest offshore natural gas production of 2.6 bcf, 2.4 bcf and 1.2 bcf respectively, in 2025 from planned and announced projects.

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Upbeat on Sapura Energy as order book grows

Author: acinanatucer   |  Publish date: Thu, 22 Jul 2021, 1:10 PM


AmInvestment Research estimates Sapura Energy group’s outstanding order book could increase by 10% to RM13bil based on the group’s bids of RM53bil currently.

In a research note on Thursday, the RM53bil would be 4.1 times its current order book. Additionally, the group is looking for prospective projects worth up to RM93bil.

“Recall that Sapura’s 1QFY22 normalised loss of RM49mil (excluding RM48mil one-off items for unamortised borrowing costs and de-designation of hedging instruments) could have turned around to a net profit of RM35mil,” it said.

This was after the removal of forex losses of RM43mil and Covid-19-related costs of RM42mil from quarantine, tests and productivity losses, it said.

AmInvest Research said additionally, all four core operations were profitable in 1QFY22 with the drilling division rebounding to a pretax profit of RM22mil with only seven rigs in operation.

Against the backdrop of improving prospects for new jobs across the globe, better cost structure and underpinned by a revitalised RM10bil debt structure amid more optimistic crude oil prices, the stock currently trades at an undeserved fire-sale 0.2 times price-to-book value for an integrated oil & gas operator with an established regional footprint and proven delivery record.

The research house reiterated its buy recommendation on Sapura Energy with an unchanged fair value of 29 sen a share, pegged to a 50% discount to its FY21F book value. This valuation reflects a neutral ESG rating of three stars.

“Our forecasts, which are higher than consensus, are maintained as Sapura’s new contracts worth RM1.2bil to provide engineering & construction (E&C), operations & maintenance (O&M) and drilling services are in line with its FY22F fresh order book assumption of RM6bil,” it said.

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