COASTAL Contracts Bhd's three units have collectively secured contracts for the sale of seven offshore support vessels,
three tugboats and two oil barges worth RM268 million.

Including the new contracts, Coastal Group now has about RM760 million worth of vessel sales orders awaiting delivery to customers up to 2012, it said.

The revenue stream from the latest contracts is expected to contribute positively to the earnings per share and net assets per share of Coastal Group for the financial years ending Dec 31, 2011 and 2012, it said in a statement.

The wholly-owned subsidiaries that secured the new contract are Coastal Offshore (Labuan) Pte Ltd, Pleasant Engineering Sdn Bhd and Thaumas Marine Ltd.

The latest contracts will be the largest vessel sale orders for Coastal Group since December 2009, and will significantly replenish our vessel sales orderbook, its executive chairman Ng Chin Heng said.

Of the seven OSV sales secured by Coastal Group, six units were purchased by Tidewater Group, which is the world's largest and most experienced provider of marine support services for the offshore energy industry.

The other unit of OSV was sold to Swiber Group, which offers a full range of offshore engineering, procurement, construction, installation and commissioning and marine support services to support the entire spectrum of offshore oil and
gas exploration projects.

'We are pleased that Coastal Group was able to capitalise on the recovery in the shipbuilding sector by securing these contract wins from existing as well as
new customers,' he said.

Moving forward, he said, greater emphasis would be placed on building larger deepwatersuited and dynamic-positioning enabled vessels as Coastal Group seeks to broaden its product offering and scale up shipbuilding value chain.

Regionally, demand for OSV services would increase, especially in Malaysia, Indonesia and Vietnam, as more new oil and gas exploration activities are expected to take place in coming years, said Ng.

With the gradually improving world economic outlook, this will lead to increasing demand for oil and gas and increased production spending by oil majors.

'As structural demand for oil and gas from emerging economies continues to grow, investments in exploration and development activities are expected to increase.

'Paired with rising prices for crude oil, the resultant demand for OSV is expected to remain firm,' he added. -- BERNAMA