Petronas, HHI to sign US$1.1 bln novation agreement with MISC

Petronas and Hyundai Heavy Industries Co Ltd (HHI) have agreed to enter into a novation agreement with MISC Bhd that will involve an expenditure of about US$1.1 billion.

The agreement is for the novation of Shipbuilding Contracts (SBCs) between Petronas and HHI to the shipping company, for the construction and delivery of new LNG carriers (Newbuild LNGCs).

In conjunction with the novation agreement, Petronas via its indirect subsidiary Petronas LNG Sdn Bhd (PLSB) has also agreed to enter into Time Charter Parties (TCPs) for the charter of the Newbuild LNGCs.

BASF, Petronas Chemicals to build 2-EHAcid plant in Malaysia

Germany's BASF and Malaysia's Petronas Chemicals Group Bhd will build the first Southeast Asian plant producing 2-Ethylhexanoic Acid (2-EHAcid), the companies said on Monday without disclosing the cost.

The plant, located in Malaysia, is expected to start production in the fourth quarter of 2016 and will have a total annual capacity of 30,000 metric tonnes of 2-EHAcid, the companies said in a statement.

2-EHAcid is a chemical intermediate used in the production of synthetic lubricants as well as oil additives

Petronas' slumping profits

In tandem with the steep decline in oil prices, Petroliam Nasional Bhd (Petronas) is expected to report less than RM10bil in pre-tax profit for its soon-to-be released fourth-quarter results for the financial year 2014 (FY14), say industry sources.

The price of Brent crude has more than halved from the high of US$115 recorded in mid-June last year to about US$55 a barrel currently, with the slide largely happening in the final three months of the year.

For the current year of operations, analysts are expecting Petronas, which is expected to announce its 2014 fourth-quarter results in the next few weeks, to record a sombre set of results.