By Lawrence Yong
Petra Energy Bhd is eyeing another RM1.4 billion in oil and gas jobs, even after securing its biggest hook up, construction and commissioning (HUCC) contract in its 13-year history of servicing brownfields offshore Sabah and Sarawak.
After going through a choppy patch in the last few years, Sarawak’s Petra looks likely to soar and become a petroleum development company at least three times its original size, company sources said.
In a presentation which painted an upbeat picture of the company, Petra said that it may still look for more jobs in new subsea segment, and service contracts in Malaysia or elsewhere even as it is reaching near full capacity after just securing a five-year, RM2.5 billion hook up, construction and commissioning (HUCC) job from Petronas.
Anthony Firdauz Bujang
“We will continuously explore for HUCC contracts. Of course, we have to consider our capacity….it’s important that we deliver a good performance,” Petra’s CEO Anthony Firdauz Bujang told reporters after the company’s seventh AGM in Kuala Lumpur.
Bujang said that the company now had a tenderbook of RM1.4 billion and an orderbook of about RM3 billion.
On Wednesday, industry sources told KiniBiz that Petra had bagged a RM2.5 billion hook up, construction and commissioning (HUCC) job from Petronas Carigali Sdn Bhd for the Sarawak and Sabah region, which boosted its orderbook significantly.
For the first three months of FY13 ended March, Petra Energy posted paltry net profits of RM2.2 million from RM92.4 million in sales. But market watchers said the company’s was worth watching out for. Since early May, Petra Energy’s stock on Bursa Malaysia has gained more than 50%.
Petra’s CEO Bujang affirmed that the company may earn more than 15% net margin from the Petronas HUCC contract alone. “Conservatively, we are looking at net margin of 15%… that’s achievable,” Bujang said.
Before this, it’s biggest HUCC contract was a RM1.1 billion job from Shell companies in east Malaysia, company sources said. Petra won its first HUCC contract in 2000 from ExxonMobil Corp, valued at RM300 million.
Brownfield services and topside maintenance and HUCC jobs, which are the small-cap company’s mainstays, raked in almost 80% of its revenue for 2012. Besides recent expansion of its HUCC business, Petra also plans to expand into subsea business.
The company may earn also earn extra from the marine spread from servicing the Petronas HUCC contract. Bujang said that Petra plans to expand its fleet of offshore support vessels. The company now owns four barges, two boats and a Anchor handling tug supply barge. It plans acquire two more boats on long term lease, with options to purchase. They will be delivered in the second half of this year.
“For our contract with Carigali we expect our work boats will be fully occupied,” Bujang said.
Petra is also only the third Malaysian company to hold a risk service contract for a marginal oil field from Petronas. It has a 30% stake in a venture with Coastal Corp to extract oil from Kapal, Banang and Meranti (KBM) cluster, offshore Sarawak.
Bujang said that KBM work was on schedule to start drilling in August. A drilling rig, currently used in Thailand by Coastal Energy Co, would be deployed to Kapal field by mid-July and a mobile offshore production unit (MOPU), now being refurbished at MMHE’s Pasir Gudang yard, would be sent there by end August. The plan is to start drilling six wells. Under the RSC, a total of 17 wells may be drilled.
Bujang gave a rough gauge that its RSC may make up as 25% of Petra’s total revenue from 2015. Preliminary expectations to strike first oil later this year.
Looking ahead, a company source said that Petra was now looking at enhancing work synergy with a major shareholder Wah Seong Corp which last year bought a 26.9% stake in the company.
“They have the space, we have the Petronas license,” the source said.
Wah Seong is one of the leading pipeline coating companies in the world and has a underused fabrication yard, the source said.
Besides Wah Seong, Petra’s shareholders include East Malaysian businessman Bustari Yusoff (27.5%), Mohamed Nizam Abdul Razak, brother of current premier Najib Abdul Razak. (9.09%) and Lembaga Tabung Haji (7.78%).
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