In what can be billed as one of the mega oil and gas exploration deals in the country, two local helicopter operators have clinched a RM8 billion package deal with national oil corporation, Petroliam Nasional Berhad (Petronas), to perform offshore transport missions.
Industry officials named the two as Malaysian Helicopter Services (MHS) Aviation Bhd and Weststar Aviation Sdn Bhd, which would be required to carry out air transport for offshore exploration work between Kota Baru and Kerteh for more than 10 years from April next year.
The deal includes the purchase of five Eurocopter EC 225 and nine AgustaWestland AW139 light-medium helicopters by MHS and Weststar, respectively.
Also included are training for the air and technical crew, and comprehensive support packages.
The two companies successfully made the bid over two other companies, Sabah Air and Sarawak-based Hornbill Skyways, when tenders closed in March this year, the industry officials added.
Petronas had chosen MHS and Weststar Aviation for fitting the bill.
"To add icing on the cake, a defence industry government-linked company has shown interest in acquiring a major stake in one of the companies.
"This will enhance and fortify the company's business development," industry officials said.
For the record, MHS is believed to have an existing three-year contract worth RM300 million with Petronas which will expire in March next year.
With a fleet of 25 helicopters and 585 employees, MHS has a long and credible track record in helicopter operations with more than 27 years' offshore experience. It has bases in Kerteh, Kota Baru, Miri, Labuan, Subang and Nouakchott in Mauritania.
In 1997, at the height of the economic recession, 13 entrepreneurs obtained a loan from Venture Capital for a RM260 million buyout of MHS from Tan Sri Tajuddin Ramli, who at that time was also helming Malaysia Airlines.
Sunday, 12 September 2010
Saturday, 11 September 2010
Utility company: Gas line ruptured in blast area
SAN BRUNO, California – The utility company that serves the San Francisco Bay area says one of its gas lines ruptured in the area where a massive blast and fire destroyed homes and sent residents fleeing.
Pacific Gas and Electric Co. officials said in an e-mailed statement that the ruptured gas line was theirs, although they cautioned that the cause of the blast has yet to be determined.
The company said it would "take accountability" if it was found to be responsible for the explosion.
Utility crews were on the scene in San Bruno in the hills south of San Francisco working with emergency officials as the explosion was investigated.
Pacific Gas and Electric Co. officials said in an e-mailed statement that the ruptured gas line was theirs, although they cautioned that the cause of the blast has yet to be determined.
The company said it would "take accountability" if it was found to be responsible for the explosion.
Utility crews were on the scene in San Bruno in the hills south of San Francisco working with emergency officials as the explosion was investigated.
Friday, 10 September 2010
BP report blames itself, others for oil spill
In an internal report released Wednesday, BP blames itself, other companies' workers and a complex series of failures for the massive Gulf of Mexico oil spill and the drilling rig explosion that preceded it.
The 193-page report was posted on the company's website even though investigators have not yet begun to fully analyze a key piece of equipment, the blowout preventer, that should have cut off the flow of oil from the ruptured well but did not.
That means BP's report is far from the definitive ruling on the blowout's causes, but it may provide some hint of the company's legal strategy — spreading the blame among itself, rig owner Transocean, and cement contractor Halliburton — as it faces hundreds of lawsuits and possible criminal charges over the spill. Government investigators and congressional panels are looking into the cause as well.
"This report is not BP's mea culpa," said Rep. Edward J. Markey, D-Mass., a frequent BP critic and a member of a congressional panel investigating the spill. "Of their own eight key findings, they only explicitly take responsibility for half of one. BP is happy to slice up blame, as long as they get the smallest piece."
Robert Gordon, an attorney whose firm represents more than 1,000 fisherman, hotels, and restaurants affected by the spill, was more blunt.
"BP blaming others for the Gulf oil disaster is like Bernie Madoff blaming his accountant," he said.
Members of Congress, industry experts and workers who survived the rig explosion have accused BP's engineers of cutting corners to save time and money on a project that was 43 days and more than $20 million behind schedule at the time of the blast.
BP's report acknowledged, as investigators have previously suggested, that its engineers and employees of Transocean misinterpreted a pressure test of the well's integrity. It also blamed employees on the rig from both companies for failing to respond to warning signs that the well was in danger of blowing out.
Mark Bly, BP's chief investigator, said at a briefing in Washington that the internal report was a reconstruction of what happened on the rig based on the company's data and interviews with mostly BP employees and was not meant to focus on assigning blame. The six-person investigating panel only had access to a few workers from other companies, and samples of the actual cement used in the well were not released.
Outgoing BP chief Tony Hayward, who is being replaced Oct. 1 by American Bob Dudley, said in a statement that a bad cement job and a failure of a barrier at the bottom of the well let oil and gas leak out.
Transocean blasted BP's report, calling it a self-serving attempt to conceal the real cause of the explosion, which it blamed on what it called "BP's fatally flawed well design."
"In both its design and construction, BP made a series of cost-saving decisions that increased risk — in some cases, severely," Transocean said.
Halliburton said in a statement of its own that it found a number of omissions and inaccuracies in the report and is confident the work it completed on the well met BP's specifications.
"Contractors do not specify well design or make decisions regarding testing procedures as that responsibility lies with the well owner," the statement said.
An AP analysis of the report shows that the words "blame" and "mistake" never appear. "Fault" shows up 20 times, but only once in the same sentence as the company's name.
Steve Yerrid, special counsel on the oil spill for Florida Gov. Charlie Crist, said the report clearly shows the company is attempting to spread blame for the well disaster, foreshadowing what will be a likely legal effort to force Halliburton and Transocean, and perhaps others, to share costs such as paying claims and government penalties.
In midday trading in New York, BP shares were up $1.15, or 3 percent, to $38.32.
Several divisions of the U.S. government, including the Justice Department, Coast Guard and Bureau of Ocean Energy Management, Regulation and Enforcement, are also investigating the explosion.
The blowout preventer was raised from the water off the coast of Louisiana on Saturday. As of Tuesday afternoon, it had not reached a NASA facility in New Orleans where government investigators planned to analyze it, so those conclusions were not part of BP's report.
Retired Coast Guard Adm. Thad Allen, the government's point man on the spill response, said the BP report will add to investigators' understanding "but is not the end-all-be-all ... about why it happened and what needs to happen in the future."
The rig explosion killed 11 workers and sent 206 million gallons of oil spewing from BP's undersea well.
Investigators know the explosion was triggered by a bubble of methane gas that escaped from the well and shot up the drill column, expanding quickly as it burst through several seals and barriers before igniting.
But they don't know exactly how or why the gas escaped. And they don't know why the blowout preventer didn't seal the well pipe at the sea bottom after the eruption, as it was supposed to.
There were signs of problems prior to the explosion, including an unexpected loss of fluid from a pipe known as a riser five hours before the explosion that could have indicated a leak in the blowout preventer.
Witness statements show that rig workers talked just minutes before the blowout about pressure problems in the well.
At first, nobody seemed too worried, workers have said. Then panic set in.
Workers called their bosses to report that the well was "coming in" and that they were "getting mud back." The drilling supervisor, Jason Anderson, tried to shut down the well.
It didn't work. At least two explosions turned the rig into an inferno.
In its report, BP defended the well's design, which has been criticized by industry experts. It also said "more thorough review and testing by Halliburton" and "stronger quality assurance" by BP's well team well might have identified potential flaws and weaknesses in the design for the cement job.
Other conclusions in the report include:
• BP says its use of six centralizers, key devices used as part of the process to plug a well, instead of the 21 recommended by Halliburton likely did not contribute to the cement's failure. Congress has questioned BP's decision, because centralizers ensure casing runs down the center of the well bore and an imperfect seal could allow oil and gas to shoot up.
• BP said that while drilling the well on March 8, more than a month before the disaster, there was a "kick," or fluid entering the well bore from the oil reservoir, that wasn't noticed for 33 minutes. BP says there's no evidence Transocean took any documented, corrective actions with the rig crew either to acknowledge or address the response time.
• Workers realized eight minutes before the blast that flammable oil and gas was traveling up the pipe connecting the rig to the well head, although data revealed that would happen 40 minutes before the explosion.
• The blowout preventer failed to do its job in part because equipment was faulty but also because it was damaged during the explosion.
• The drilling crew routed the flow from the blownout well to a system on the rig instead of overboard, a decision that allowed gas to get into ventilation systems, where it caught fire.
The 193-page report was posted on the company's website even though investigators have not yet begun to fully analyze a key piece of equipment, the blowout preventer, that should have cut off the flow of oil from the ruptured well but did not.
That means BP's report is far from the definitive ruling on the blowout's causes, but it may provide some hint of the company's legal strategy — spreading the blame among itself, rig owner Transocean, and cement contractor Halliburton — as it faces hundreds of lawsuits and possible criminal charges over the spill. Government investigators and congressional panels are looking into the cause as well.
"This report is not BP's mea culpa," said Rep. Edward J. Markey, D-Mass., a frequent BP critic and a member of a congressional panel investigating the spill. "Of their own eight key findings, they only explicitly take responsibility for half of one. BP is happy to slice up blame, as long as they get the smallest piece."
Robert Gordon, an attorney whose firm represents more than 1,000 fisherman, hotels, and restaurants affected by the spill, was more blunt.
"BP blaming others for the Gulf oil disaster is like Bernie Madoff blaming his accountant," he said.
Members of Congress, industry experts and workers who survived the rig explosion have accused BP's engineers of cutting corners to save time and money on a project that was 43 days and more than $20 million behind schedule at the time of the blast.
BP's report acknowledged, as investigators have previously suggested, that its engineers and employees of Transocean misinterpreted a pressure test of the well's integrity. It also blamed employees on the rig from both companies for failing to respond to warning signs that the well was in danger of blowing out.
Mark Bly, BP's chief investigator, said at a briefing in Washington that the internal report was a reconstruction of what happened on the rig based on the company's data and interviews with mostly BP employees and was not meant to focus on assigning blame. The six-person investigating panel only had access to a few workers from other companies, and samples of the actual cement used in the well were not released.
Outgoing BP chief Tony Hayward, who is being replaced Oct. 1 by American Bob Dudley, said in a statement that a bad cement job and a failure of a barrier at the bottom of the well let oil and gas leak out.
Transocean blasted BP's report, calling it a self-serving attempt to conceal the real cause of the explosion, which it blamed on what it called "BP's fatally flawed well design."
"In both its design and construction, BP made a series of cost-saving decisions that increased risk — in some cases, severely," Transocean said.
Halliburton said in a statement of its own that it found a number of omissions and inaccuracies in the report and is confident the work it completed on the well met BP's specifications.
"Contractors do not specify well design or make decisions regarding testing procedures as that responsibility lies with the well owner," the statement said.
An AP analysis of the report shows that the words "blame" and "mistake" never appear. "Fault" shows up 20 times, but only once in the same sentence as the company's name.
Steve Yerrid, special counsel on the oil spill for Florida Gov. Charlie Crist, said the report clearly shows the company is attempting to spread blame for the well disaster, foreshadowing what will be a likely legal effort to force Halliburton and Transocean, and perhaps others, to share costs such as paying claims and government penalties.
In midday trading in New York, BP shares were up $1.15, or 3 percent, to $38.32.
Several divisions of the U.S. government, including the Justice Department, Coast Guard and Bureau of Ocean Energy Management, Regulation and Enforcement, are also investigating the explosion.
The blowout preventer was raised from the water off the coast of Louisiana on Saturday. As of Tuesday afternoon, it had not reached a NASA facility in New Orleans where government investigators planned to analyze it, so those conclusions were not part of BP's report.
Retired Coast Guard Adm. Thad Allen, the government's point man on the spill response, said the BP report will add to investigators' understanding "but is not the end-all-be-all ... about why it happened and what needs to happen in the future."
The rig explosion killed 11 workers and sent 206 million gallons of oil spewing from BP's undersea well.
Investigators know the explosion was triggered by a bubble of methane gas that escaped from the well and shot up the drill column, expanding quickly as it burst through several seals and barriers before igniting.
But they don't know exactly how or why the gas escaped. And they don't know why the blowout preventer didn't seal the well pipe at the sea bottom after the eruption, as it was supposed to.
There were signs of problems prior to the explosion, including an unexpected loss of fluid from a pipe known as a riser five hours before the explosion that could have indicated a leak in the blowout preventer.
Witness statements show that rig workers talked just minutes before the blowout about pressure problems in the well.
At first, nobody seemed too worried, workers have said. Then panic set in.
Workers called their bosses to report that the well was "coming in" and that they were "getting mud back." The drilling supervisor, Jason Anderson, tried to shut down the well.
It didn't work. At least two explosions turned the rig into an inferno.
In its report, BP defended the well's design, which has been criticized by industry experts. It also said "more thorough review and testing by Halliburton" and "stronger quality assurance" by BP's well team well might have identified potential flaws and weaknesses in the design for the cement job.
Other conclusions in the report include:
• BP says its use of six centralizers, key devices used as part of the process to plug a well, instead of the 21 recommended by Halliburton likely did not contribute to the cement's failure. Congress has questioned BP's decision, because centralizers ensure casing runs down the center of the well bore and an imperfect seal could allow oil and gas to shoot up.
• BP said that while drilling the well on March 8, more than a month before the disaster, there was a "kick," or fluid entering the well bore from the oil reservoir, that wasn't noticed for 33 minutes. BP says there's no evidence Transocean took any documented, corrective actions with the rig crew either to acknowledge or address the response time.
• Workers realized eight minutes before the blast that flammable oil and gas was traveling up the pipe connecting the rig to the well head, although data revealed that would happen 40 minutes before the explosion.
• The blowout preventer failed to do its job in part because equipment was faulty but also because it was damaged during the explosion.
• The drilling crew routed the flow from the blownout well to a system on the rig instead of overboard, a decision that allowed gas to get into ventilation systems, where it caught fire.
Wednesday, 8 September 2010
Tapis oil set at record high
Petroliam Nasional Bhd, Malaysia’s state oil and gas company, increased a price-adjustment factor for its Tapis crude for this month’s shipments to a record.
The factor was raised by 40 cents, or 11 per cent, from August to US$4.10 a barrel for September, said an official at Petronas, as the Kuala Lumpur-based company is known, asking not to be identified because of corporate policy. Last year, the price factor averaged US$2.48.
The increase follows a recovery in margins for processing light crude such as Tapis into gasoil, or diesel. The product’s premium to Dubai crude, the Asian benchmark, was at US$11.38 a barrel today, up 42 per cent so far this year, according to brokers PVM Oil Associates. This crack spread is a measure of refining profit.
Petronas includes the adjustment factor in its formula for calculating monthly official selling prices. The other component is the average of twice-weekly assessments compiled by the Asian Petroleum Price Index, a Hong Kong-based panel of traders. -- Bloomberg
The factor was raised by 40 cents, or 11 per cent, from August to US$4.10 a barrel for September, said an official at Petronas, as the Kuala Lumpur-based company is known, asking not to be identified because of corporate policy. Last year, the price factor averaged US$2.48.
The increase follows a recovery in margins for processing light crude such as Tapis into gasoil, or diesel. The product’s premium to Dubai crude, the Asian benchmark, was at US$11.38 a barrel today, up 42 per cent so far this year, according to brokers PVM Oil Associates. This crack spread is a measure of refining profit.
Petronas includes the adjustment factor in its formula for calculating monthly official selling prices. The other component is the average of twice-weekly assessments compiled by the Asian Petroleum Price Index, a Hong Kong-based panel of traders. -- Bloomberg
Tuesday, 7 September 2010
Banks set to bid for Petronas IPOs
A number of local investment banks are in the midst of preparing proposals to secure the mandate to handle the initial public offerings (IPO) of Malaysia Marine and Heavy Engineering Sdn Bhd (MMHE) and Petroliam Nasional Bhd’s (Petronas) petrochemicals business, industry sources said.
It is understood that among those Petronas issued a request for proposal (RFP) are the investment banking arms of CIMB, RHB, Maybank and the AmBank group.
Sources added that the deadline for submitting the proposals is sometime next week and that the banks would be assessed on their broad approach to the IPOs.
A key issue will be the valuation method the banks would be comfortable using in pricing the IPO.
This may range from multiples of profits or of earnings before interest, tax, depreciation and amortisation.
“The track record of the investment bank would also play a factor. So too would be signs of innovativeness in the suggested IPO structures,” said one banker.
It is understood that Petronas and MISC Bhd (the parent of MMHE) have hired an advisor to oversee the RFPs and the selection of investment banks for the IPOs.
Analysts said that MMHE, which reported a net profit of RM284mil in the financial year ended March 31, 2009 (FY09), could fetch an attractive price-earnings multiple of its FY09 earnings, possibly in the high teens.
A valuation of say 17 times its FY09 earnings would give MMHE a total valuation of around RM5bil.
Its performance is driven by three core businesses: engineering and construction services, marine conversion and marine repair.
MMHE runs a yard in Pasir Gudang, Johor, one of the largest in the region and the only one capable of converting big ships into vessels that can process and store oil and gas.
These are known as floating, production storage and offloading units and floating storage offloading units. The yard is also used to fabricate high-tonnage offshore oil and gas structures.
According to OSK Research, MMHE had a huge outstanding order book valued at RM6.4bil as at Dec 31, 2009.
More jobs are expected to come with the oil price stabilising at US$84 per barrel with potential upside. Petronas may also dish out some large-scale projects to MMHE following the former’s success with its partners in winning the rights to develop four oilfields in Iraq late last year.
The proposed listing of MMHE could be considered a “continuation” of its listing intention that did not materialise when the MISC-Ramunia Holdings Bhd reverse takeover (RTO) deal fell through in 2008 due to unsatisfactory due diligence findings.
In the RTO, MMHE was valued at RM3.2bil.
Meanwhile, it is less clear what the IPO structure of Petronas’ petrochemical business will take. Petronas has 19 companies in the petrochemical business, including BASF Petronas Chemicals Sdn Bhd and Optimal Olefins (M) Sdn Bhd.
It is unclear if the IPO would group all of them or just some of the companies.
Petronas’ petrochemical business registered a revenue of RM13bil for the year ended March 31, 2009. Its diverse product portfolio ranges from olefins and polyolefins, fertilisers, industrial to specialty chemicals.
It is understood that among those Petronas issued a request for proposal (RFP) are the investment banking arms of CIMB, RHB, Maybank and the AmBank group.
Sources added that the deadline for submitting the proposals is sometime next week and that the banks would be assessed on their broad approach to the IPOs.
A key issue will be the valuation method the banks would be comfortable using in pricing the IPO.
This may range from multiples of profits or of earnings before interest, tax, depreciation and amortisation.
“The track record of the investment bank would also play a factor. So too would be signs of innovativeness in the suggested IPO structures,” said one banker.
It is understood that Petronas and MISC Bhd (the parent of MMHE) have hired an advisor to oversee the RFPs and the selection of investment banks for the IPOs.
Analysts said that MMHE, which reported a net profit of RM284mil in the financial year ended March 31, 2009 (FY09), could fetch an attractive price-earnings multiple of its FY09 earnings, possibly in the high teens.
A valuation of say 17 times its FY09 earnings would give MMHE a total valuation of around RM5bil.
Its performance is driven by three core businesses: engineering and construction services, marine conversion and marine repair.
MMHE runs a yard in Pasir Gudang, Johor, one of the largest in the region and the only one capable of converting big ships into vessels that can process and store oil and gas.
These are known as floating, production storage and offloading units and floating storage offloading units. The yard is also used to fabricate high-tonnage offshore oil and gas structures.
According to OSK Research, MMHE had a huge outstanding order book valued at RM6.4bil as at Dec 31, 2009.
More jobs are expected to come with the oil price stabilising at US$84 per barrel with potential upside. Petronas may also dish out some large-scale projects to MMHE following the former’s success with its partners in winning the rights to develop four oilfields in Iraq late last year.
The proposed listing of MMHE could be considered a “continuation” of its listing intention that did not materialise when the MISC-Ramunia Holdings Bhd reverse takeover (RTO) deal fell through in 2008 due to unsatisfactory due diligence findings.
In the RTO, MMHE was valued at RM3.2bil.
Meanwhile, it is less clear what the IPO structure of Petronas’ petrochemical business will take. Petronas has 19 companies in the petrochemical business, including BASF Petronas Chemicals Sdn Bhd and Optimal Olefins (M) Sdn Bhd.
It is unclear if the IPO would group all of them or just some of the companies.
Petronas’ petrochemical business registered a revenue of RM13bil for the year ended March 31, 2009. Its diverse product portfolio ranges from olefins and polyolefins, fertilisers, industrial to specialty chemicals.
Monday, 6 September 2010
Petronas Unit Bids Again for Shell, BP Businesses in Zimbabwe
Petronas African unit, Engen Petroleum Ltd., has bid again to buy Royal Dutch Shell Plc and BP Plc’s Zimbabwean businesses, the state-controlled Herald said, citing Engen special projects consultant Andrew Bryce.
The National Indigenisation and Empowerment Fund on March 25 rejected an offer for the businesses from Engen and Kenya’s KenolKobil Ltd., the Harare-based Herald said. The bid prompted opposition from black-empowerment lobbying groups, the newspaper said.
The new bid by Engen meets Zimbabwean laws regarding black ownership of companies, the Herald quoted Bryce as saying.
The National Indigenisation and Empowerment Fund on March 25 rejected an offer for the businesses from Engen and Kenya’s KenolKobil Ltd., the Harare-based Herald said. The bid prompted opposition from black-empowerment lobbying groups, the newspaper said.
The new bid by Engen meets Zimbabwean laws regarding black ownership of companies, the Herald quoted Bryce as saying.
Saturday, 4 September 2010
Petronas makes oil, gas discovery off Vietnam
Petronas Carigali Overseas Bhd. made an oil and natural gas discovery with its Ham Rong-2X well in the Ham Rong oil field off northern Vietnam, according to local media reports.
Commercial output was estimated at 6,300 b/d and 8 MMscfd of gas on Block 106 of the Song Hong basin, about 75 km south of Haiphong, Vietnam’s official news agency said, citing the Tuoi Tre newspaper.
Analyst IHS Global Insight said the Ham Rong 2X well is likely to be an appraisal well on Block 106. The well followed the drilling of the Do-Son 1X wildcat, which was plugged and abandoned in mid-November 2009 having also encountered oil and gas shows.
“The discoveries at Ham Rong-2X will further support the company's exploration plans in Block 106, despite the complexities of exploring the area, due to seismic imaging difficulties and complex reservoir architecture,” IHS Global Insight said.
Petronas is operator of the block with a 50% stake. The remaining 50% is divided among Singapore's SPC, PetroVietnam Exploration & Production, and ATI Petroleum.
Commercial output was estimated at 6,300 b/d and 8 MMscfd of gas on Block 106 of the Song Hong basin, about 75 km south of Haiphong, Vietnam’s official news agency said, citing the Tuoi Tre newspaper.
Analyst IHS Global Insight said the Ham Rong 2X well is likely to be an appraisal well on Block 106. The well followed the drilling of the Do-Son 1X wildcat, which was plugged and abandoned in mid-November 2009 having also encountered oil and gas shows.
“The discoveries at Ham Rong-2X will further support the company's exploration plans in Block 106, despite the complexities of exploring the area, due to seismic imaging difficulties and complex reservoir architecture,” IHS Global Insight said.
Petronas is operator of the block with a 50% stake. The remaining 50% is divided among Singapore's SPC, PetroVietnam Exploration & Production, and ATI Petroleum.
Thursday, 2 September 2010
BP sells Malaysian petrochemical operations to Petronas
BP continued its asset disposals to pay for the cost of the Gulf of Mexico oil spill with a $363m (£235m) sales of its Malaysian petrochemical operations to state-owned Petronas.
The oil company is selling a 15pc stake in Ethylene Malaysia and a 60pc interest in Polyethylene Malaysia to the Petronas, which already operates the two businesses.
The oil company is selling a 15pc stake in Ethylene Malaysia and a 60pc interest in Polyethylene Malaysia to the Petronas, which already operates the two businesses.
It will also be eligible for a possible $48m dividend from the ethylene unit.
Sue Rataj, president of BP’s Global Petrochemicals Business, said in a statement: “BP will continue to focus on the development and expansion of our olefins and derivatives business in China, and other large rapidly growing markets, and pursue opportunities in China and India.”
BP in July pledged to sell as much as £20bn of assets to meet the spill costs. It has agreed to sell oil and gas fields in the US, Canada and Egypt to Houston-based Apache for $7bn. - www.telegraph.co.uk
Sue Rataj, president of BP’s Global Petrochemicals Business, said in a statement: “BP will continue to focus on the development and expansion of our olefins and derivatives business in China, and other large rapidly growing markets, and pursue opportunities in China and India.”
BP in July pledged to sell as much as £20bn of assets to meet the spill costs. It has agreed to sell oil and gas fields in the US, Canada and Egypt to Houston-based Apache for $7bn. - www.telegraph.co.uk
Wednesday, 1 September 2010
Samsung Engineering wins US$770m Petronas deal
PETRONAS Carigali Sdn Bhd has awarded a US$770 million (RM2.4 billion) contract to Samsung Engineering to build an oil and gas terminal in Sabah.
The plant, which will produce 300,000 barrels of oil and 1.25 billion cubic feet of gas per day, will account for 40 per cent of Malaysia's crude oil production.
Samsung Engineering president and chief executive officer Park Ki-Seok said the contract reflects the company's excellent project performance and the clients' trust in the hydrocarbon plant sector.
"With expanding market share in the GOSP (gas oil separation plant) field and about US$50 billion (RM157 billion) invested annually, we plan to continue our drive to diversify our market and products in all upstream hydrocarbon fields such as offshore projects," Park said in a statement.
For the Sabah project, Samsung Engineering will lead the engineering, procurement, construction and commissioning work with local partner NCSB Engineering.
The plant is expected to be mechanically completed in December 2013.
Park said Samsung Engineering has successfully executed an ethylene project in Malaysia, gas plants in Thailand's Songkola and a PVC (polyvinyl chloride) plant in Vietnam for Petronas.
"Samsung has had a lot of experience in gas separation plants and oil facilities in the Middle East, Africa and Southeast Asia, and plans to continue its expansion into the GOSP hydrocarbon upstream sector with the Sabah oil and gas terminal," he added.
The company was ranked 35 in the recently published 2010 list of Top International Contractors (based on overseas revenue) by Engineering News Record. It made a significant jump, moving up by 18 spots from 2009.
The plant, which will produce 300,000 barrels of oil and 1.25 billion cubic feet of gas per day, will account for 40 per cent of Malaysia's crude oil production.
Samsung Engineering president and chief executive officer Park Ki-Seok said the contract reflects the company's excellent project performance and the clients' trust in the hydrocarbon plant sector.
"With expanding market share in the GOSP (gas oil separation plant) field and about US$50 billion (RM157 billion) invested annually, we plan to continue our drive to diversify our market and products in all upstream hydrocarbon fields such as offshore projects," Park said in a statement.
For the Sabah project, Samsung Engineering will lead the engineering, procurement, construction and commissioning work with local partner NCSB Engineering.
The plant is expected to be mechanically completed in December 2013.
Park said Samsung Engineering has successfully executed an ethylene project in Malaysia, gas plants in Thailand's Songkola and a PVC (polyvinyl chloride) plant in Vietnam for Petronas.
"Samsung has had a lot of experience in gas separation plants and oil facilities in the Middle East, Africa and Southeast Asia, and plans to continue its expansion into the GOSP hydrocarbon upstream sector with the Sabah oil and gas terminal," he added.
The company was ranked 35 in the recently published 2010 list of Top International Contractors (based on overseas revenue) by Engineering News Record. It made a significant jump, moving up by 18 spots from 2009.
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