Posted by apple4ver > 2023-06-06 16:29 | Report Abuse

Armada Kraken was the problematic FPSO that nearly brought Armada down back in 2018. A litany of problems from project delays, cost overblowns, penalties and nearly endless production issues had literally caused investors pulling out their hair. So, Armada Kraken + Shutdown naturally trigger those nightmarish memories. Hence, the reactions today..

An one-off ~RM100m hit from current shutdown would be painful but not fatal. It would be a grave concern however if the shutdown is the beginning of a series of problems that is not unlike what plagued Armada Kraken during the commercement of the FPSO. Yet, before the latest problem, Armada Kraken was running optimally for the last 3 consecutive years. Whatever technical issues during the initial stage should have been throughly fixed.

It should be noted the current problem is related to transformers. Just requote from Robert Waters

------------------
Nowhere I saw transformer failure as a MAE (Main Accident Event). Most pumps are in sets with1 online and 1 on standby. Surely if critical, not just 2, there may be 3 to be safe side by side. So are the transformers. And you can always get a new transformer from warehouse, fly it with helicopter and have it installed by electricians that just wire it in. No need to break containment.
------------------

On balance, the shutdown is more likely an one-off freak incident than a precursor to something more sinister down the road. Our fear is our natural defence for self-preservation or in this case, capital preservation. With the risks capped by the return to production later this week, is the market far too fearful than it deserved?

Posted by sinkalan2015 > 2023-06-06 16:33 | Report Abuse

see! told you guys to be patient. tomorrow another day of free fall! I'll wait for RM0.40!

Posted by xuxu > 2023-06-06 16:39 | Report Abuse

buy batch by batch don't all in first

Posted by nicky > 2023-06-06 16:46 | Report Abuse

Closed below RM0.50....not good

Posted by GoldenShares > 2023-06-06 16:48 | Report Abuse

experienced trader definitely wait n see, at least after margin call and force selling, below 0.45 is possible

Posted by super aloha > 2023-06-06 16:49 | Report Abuse

crab it again 0.490. wish it's could recover back with good news..

Posted by MM78 > 2023-06-06 16:55 | Report Abuse

Yes buy batch by batch and if aggressive at bigger volume at lower price. Not all in at once. Lessons learnt long time ago.

Posted by Russel > 2023-06-06 17:00 | Report Abuse

I buy some @ RM0.495

Posted by vespa > 2023-06-06 17:01 | Report Abuse

mgmt has a credibility issue

Posted by MichelleNg > 2023-06-06 17:03 | Report Abuse

Uptrend turned downtrend....huge selling and nobody willing to buy above 50cents....

Posted by Mabel > 2023-06-06 17:07 | Report Abuse

Hopefully tonight got good news..

Tomorrow fly again..downtrend turn Uptrend..

Meow

Posted by sense maker > 2023-06-06 17:11 | Report Abuse

Just buy 5% of your total planned purchase every time the price drops half a sen. Sure boleh make some money.

Posted by MM78 > 2023-06-06 17:15 | Report Abuse

Reply Mabel
" Great MM78 and Bon888! "
Trying to get some bargains when market is fearful but only at those counters I am familiar with their fundamentals. 😊 Good Luck to all who try.

Posted by Medusa > 2023-06-06 17:26 | Report Abuse

Fast come 40c waiting eagerly

Posted by KoiFish > 2023-06-06 17:34 | Report Abuse

This Mabel sounds like the uncle tuttut

Posted by KoiFish > 2023-06-06 17:35 | Report Abuse

Buying in anyway, this only affected those who scare and without cashflow, cheers

Posted by Mabel > 2023-06-06 17:48 | Report Abuse

Here is what the expert is saying..

Bumi Armada's share-price weakness may be a good opportunity to accumulate, Affin Hwang IB analyst Tan Jianyuan says in a note. He doesn't think the Armada Kraken floating production storage and offloading vessel operations suspension is a major setback and expects a quick fix. "The already low 5X price-to-earnings ratio valuation for 2023-2024 should cushion the share price from declining too sharply," he adds. Tan cuts Bumi Armada's 2023, 2024 and 2025 earnings forecasts by 8.0%, 9.2% and 16%, respectively, assuming a 90-day interruption. Affin Hwang lowers Bumi Armada's target price to MYR0.80 from MYR0.85 but maintains a buy rating on the stock. Shares are 20% lower at MYR0.51. (yingxian.wong@wsj.com)

Posted by Mabel > 2023-06-06 17:49 | Report Abuse

Bumi Armada may resolve its Armada Kraken floating production storage and offloading vessel's suspension of operations in the short term, RHB IB analyst Sean Lim says in a note. He doesn't expect a "lumpy vessel impairment." Based on Lim's estimate, the Armada Kraken FPSO will generate about 30% to 35% of 2023 earnings. He therefore cuts his 2023 earnings forecast for the company by 14%, assuming a three-month interruption and additional maintenance expenses. RHB lowers Bumi Armada's target price to MYR0.73 from MYR0.80 but maintains a buy rating due to its attractive valuation and strengthening balance sheet. Shares are 21% lower at MYR0.50.

Posted by Mabel > 2023-06-06 18:23 | Report Abuse

Bumi Armada Berhad

Share Price 7 Day 1 Year
0.48 -24.8% 9.0%


Now 35% undervalued after recent price drop

Over the last 90 days, the stock is down 32%.

The fair value is estimated to be RM0.74, however this is not to be taken as a buy recommendation but rather should be used as a guide only.

Revenue has grown by 2.6% over the last 3 years. Meanwhile, the company has become profitable.

Revenue is forecast to grow by 2.9% in 2 years. Earnings is forecast to grow by 12% in the next 2 years.

Posted by Robert Waters > 2023-06-06 18:54 | Report Abuse

There is so much not taken into consideration in the Kraken story. HSP are downhole pumps, meaning inside wells, located at the depth of 3.5 km under the sea in the oilfield. Normally, and I do not know contract, but normally, they belong to client who owns the field, EnQuest. Normally, they are electric and named ESP. Hence they need transformers. But here they are hydraulic. They were likely installed in field before FPSO arrived by SPX Flow. Bumi Armada hooked up the FPSO to those wells with pumps inside down below, and now provides hydraulic power (hot water under pressure) to spin those pumps by means of water turbines connected to the pumps. This water heats crude oil and enables it to flow to FPSO through risers, providing a lift. Otherwise, wax could plug tubing in the well . I bet from my work offshore that EnQuest Well Department operates those pumps from the Kraken FPSO. There is always Well Dept, with specialized people that make more money and have better work conditions. They are sitting separately and protect their job. If pump seized and blowed the transformer, it may be operator's responsibility. Maybe there was wax build up already, and power liquid pumped by FPSO by means of HPU, or Hydraulic Power Unit, likely connected to transformer that broke could not handle it.

I doubt that Enquest would allow Armada to operate their wells. Well intervention is way more costly and complicated than fixing things on FPSO. I am sure they will be keen to get things resolve and avoid dispute. They may know more that Armada about what happened. And we are lucky it is the transformer onboard and NOT the pump downhole that is broken.

Posted by KML889 > 2023-06-06 19:20 | Report Abuse

Long stories short. Buy on this rare one-time "black swan" events and capitalize them.

Posted by KML889 > 2023-06-06 19:20 | Report Abuse

Thanks Robert for the great insights

Posted by dompeilee > 2023-06-06 19:21 | Report Abuse

US$480,000 PER DAY is a HUGE deal! Wait for below 30c.

Posted by Mabel > 2023-06-06 19:51 | Report Abuse

Thanks Robert for the updates

Very helpful indeed..

Meow

Posted by Bon888 > 2023-06-06 20:37 | Report Abuse

Enquest AGM :

Ian wood (Head:IR & Communications) said they will be restarting the Armada towards the end of the week.

Amjad Bseisu (Chief Executive) said it wouldn’t impact Kraken production forecasts for this year.

Enquest top management is confident this issue will be resolved and no impact to the Kraken yearly production forecast.

Posted by David Gunter > 2023-06-06 20:50 | Report Abuse

How come EnQuest share steady only? Lol

Posted by Bon888 > 2023-06-06 20:51 | Report Abuse

I get the info from Enquest`s chat.

Posted by Hotstuff > 2023-06-06 20:55 | Report Abuse

expecting a panic buy once market open tomorrow

Posted by David Gunter > 2023-06-06 20:58 | Report Abuse

You notice there are conman here in i3 only interested in con job

Posted by Bon888 > 2023-06-06 20:59 | Report Abuse

RM 888 million market capital wipeout in today`s trade. 🤣😘

Posted by KML889 > 2023-06-06 21:21 | Report Abuse

If this news is True, I mean genuinely from a trusted source then it's one heck of a comeback for Armada and the investing community. Bravo

Posted by KML889 > 2023-06-06 21:32 | Report Abuse

Bon, I looked at the chat and matched your postings here just now. The only question is how to verify the authenticity of those statements

Posted by KML889 > 2023-06-06 21:35 | Report Abuse

From there they even mentioned BA didn't seemed to care less about the transformer outage and took the leeway to go ahead with the Q3 periodic maintenance instead. How ironic. And then best of all the chat room community question all the IB analysts where on earth did they derive the 6 months outage. Interesting to see how the Mr market responds to this news

Posted by KML889 > 2023-06-06 21:41 | Report Abuse

Thanks Bon for the Lead, at least for now.Thank you.

Posted by KML889 > 2023-06-06 21:42 | Report Abuse

i3lurker, Roger that one.

Posted by Bon888 > 2023-06-06 21:46 | Report Abuse

Old man finally you said something positive. I fully agreed with you.

Why not you try your luck in Sapura Energy also? RO extended for another 9 months. Think about it.

Posted by i3lurker > 9 minutes ago | Report Abuse

sometimes in life, you need to take a considered bet.
if it turns against you then ... so be it, but its a considered thing, better than buying lottery ticket.

Posted by Bon888 > 2023-06-06 21:50 | Report Abuse

You said considered bet right. Considered bet is not playing big or small, need to have facts that supporting the decision made.

Posted by KML889 > 2023-06-06 21:53 | Report Abuse

Nevertheless All are being resourceful albeit different stand point and POV. Pros and Cons well noted. Cheers

Posted by Bon888 > 2023-06-06 22:08 |

Post removed.Why?

Posted by David Gunter > 2023-06-06 22:17 | Report Abuse

You know when you buy OEM motor local companies can do the rewinding for far cheaper and it is not a complex job

Posted by KML889 > 2023-06-06 22:24 | Report Abuse

It shut down on the 30th May . It is being restarted at end of this week, say Sunday 11th June -

That's No production for 12 days. - Not bloody 6 months ! ! !

Know I understand it will not likely be running production at 100% from day 1 . Another excerpts.

Posted by KML889 > 2023-06-06 22:25 | Report Abuse

Now the question is how long will the brought forward maintenance take before phased production again

Posted by KML889 > 2023-06-06 22:32 | Report Abuse

Right from the start it was merely HV transformers failures or blown out and hence the production outage. Nothing tangible damage to assets class and compromised in asset safety and well being. Dream Big Tomorrow

Posted by Sslee > 2023-06-06 22:50 | Report Abuse

A tranformer is used to step down electricity from 11 KV or higher KV to 415V.

Thro' motor control center a 3 phase 415V electricity current is feed into stator of the motor and the induced current will cause the rotor to rotate at 3000 or 1500 rpm.

The motor rotor is couple to the drive shaft of a pump and rotate the pump impeller inside the pump casing. The rotating impeller will sucked in the liquid from pump suction and exit the impeller at high velocity then upon exiting the pump casing discharge the velocity head is converted to pressure head. The pressure head will then force the liquid flow along the discharge piping to the intend destination.

Motor and pump are very common items use to transfer liquid from one place to another place along the piping. And normally important pump will have a hot stanby complete pump with motor and many pump spare parts and motor on cold stanby.

Posted by Sslee > 2023-06-06 23:01 | Report Abuse

At the MCC trip amp will be set that will auto cut off the electricity supply if the amp is too high (above safe operating limit).

Running at perlong high amp will cause the motor stator wiring insulation melt and short circuit and burn the stator wiring.

High amp normally cause by pump impeller overload (too heavy due to sudden change in liquid viscosity or density or addition load (bolt and net) jammed at impeller

Posted by Bon888 > 2023-06-06 23:30 | Report Abuse

Find out root cause of the transformer overloaded is more important than fixing the transformer.

Posted by chonghai > 2023-06-06 23:34 | Report Abuse

Recovering a transformer is not that difficult. If it is just short, replacing primary and secondary coil would settle.
Identifying the root cause if there is an over current, might be more tricky. If over current is due to something mechanical, then the situation might be even more complicated. This might be why Armada do not want to specify the amount of downtime. 20% drop in market cap due to an incident is just too much.

Posted by David Gunter > 2023-06-06 23:41 | Report Abuse

EnQuest share price hasn’t dropped much which to me is a surprise unless someone collecting money for elections

Posted by Bon888 > 2023-06-07 00:18 | Report Abuse

EnQuest share price closed -1.2%. Armada share price closed -23.6%.

Malaysia investors are manipulating by IB.

Posted by Robert Waters > 2023-06-07 00:56 | Report Abuse

Just to give you an idea, when I worked as a supervisor of a utility plant, an operator destroyed the transformer that was tied to transfer switch between normal power supply and emergency power. He did it by flipping switch on transfer station on and off a few times rapidly. Like a kid playing with a lightbulb. (The guy thought the power was not transferring quickly enough, so he re-engaged.) 'On and off' till it burned out. That is another way to destroy an equipment quickly. How things happen in reality.

The new transformer and switch set was 50 thousand dollars. That was 20 years ago. But still, estimate by the IB that cost of repair transformer on AK is 50 million is 1000 times to high.