Page 26 - Oil&Gas-AustralAsia-2015-Issue-1
P. 26
M ALAYSIA
Malaysian industry still positive on 2015 outlook
By Marie RYAN
The outlook for the Malaysian oil and Researchers noted that during these
gas services sector is one of “cost ra- times of comparatively low vessel char- 2016 MIDF is optimistic prices will stay
tionalisation” for at least the next fiscal ter rates, OSV operators were opting for slightly higher.
year and foreseeable future according to more short term spot charters instead MIDF Research stayed with its ‘positive’
the Malaysian Industrial Development of long term charters due to the lack of assessment on the overall outlook of the
Finance (MIDF). certainty in projects and risk around oil and gas sector from last year, placing
MIDF’s research arm has reported most, committing to long term contracts in its confidence on supported global
if not all, global oil and gas producers the current environment. crude oil prices and sustained levels of
including national oil company Petro- Malaysian OSV operator Perdana Petro- oil output being met by local activity
nas will be slowing down on spending leum Bhd (Perdana Petroleum) had its levels.
to adjust to the current low oil price stock downgraded to ‘neutral’ by MIDF In spite of the doom and gloom in the
environment. in its 2014 Financial Report stating global oil and gas industry MIDF point-
“Petronas was quoted in the media caution on investment as production ed out that contracts were still being
indicating that it will be reducing sharing contract (PSC) operators em- awarded from Petronas.
capital expenditures by 10 per cent and barked on a cost rationalisation drive, Researchers noted at beginning of
operating expenditures by approximate- adding charter rates faced downward the year Petronas awarded two OSV
ly 25 per cent to 30 per cent,” a MIDF pressure and risk with vessel charter umbrella contracts to Alam Maritim
Research said. rates dropping. Resources Bhd and Icon Offshore Bhd,
Noting the effects are already being felt There is speculation from the Malay- adding the engineering and main-
in industry and equity markets with sian bank regarding potential knock on tenance works were also awarded to
oil and gas service providers asked to effects to other segments of the oil and Barakah Offshore Petroleum Bhd.
renegotiate existing contracts. gas industry that will impact the OSV “In addition to the award of contracts,
The MIDF research also indicated that industry. activity levels remain robust in Malay-
a number of offshore support vessel Using Perdana Petroleum as an exam- sian waters as can be seen from the huge
(OSV) operators were asked to readjust ple, MIDF said if hook-up and com- increase in national crude oil produc-
charter rates for new and existing con- missioning (HUC) contractors such tion,” it said.
tracts and some operators dealt with the as Dayang Enterprise Holdings Bhd Production data from last year shows a
cancellation of vessels as more oil and (Dayang) had to reschedule job orders 15 per cent increase; with the average
gas companies shift toward using fewer the effects could be felt at Perdana, as production rate around 580,000bpd in
vessels to cut costs. Dayang charters the vessels for its HUC the first nine months and boost in the
“The positive side of cost rationalisation activities from the petroleum company. fourth quarter with rates exceeding
within the industry is with regard to Brent crude has reported to be head- 670,000bpd.
operating efficiency,” MIDF’s research- ing in a slight upward direction after On average, oil and gas stocks under
ers said. experiencing a slump toward the end of MIDF Research’s coverage have appreci-
MIDF said OSV companies would now last year. Year to date figures show Brent ated by more than 3.4 per cent year-to-
need to review their own operating crude has gone up around 6 per cent date, in-line with the appreciation in
costs by reducing by staffing and ma- surpassing US$60 a barrel. Brent crude price.
terial costs to submit competitive bids, “Going forward, we are of the view that Stocks under the research arm’s ‘buy’
without compromising their own profit Brent crude price will trade range- recommendation however, have ap-
margin. bound between US$60-70 a barrel in preciated by over 15.7 per cent year to
“During times of subdued oil prices, op- 2015,” MIDF said. date (YTD), far outpacing the broader
erators and service providers can expect Based on average global oil demand market FBMKLCI gain of only 2.7 per
fewer job orders but at more competi- growth of 1.03 million barrels per day cent YTD. §
tive rates,” it said. (mbpd) for 2015 and 1.01mbpd for
A A24 OIL & GAS ustral SIA MARCH/APRIL 2015 www.oilandgasaustralasia.com
Malaysian industry still positive on 2015 outlook
By Marie RYAN
The outlook for the Malaysian oil and Researchers noted that during these
gas services sector is one of “cost ra- times of comparatively low vessel char- 2016 MIDF is optimistic prices will stay
tionalisation” for at least the next fiscal ter rates, OSV operators were opting for slightly higher.
year and foreseeable future according to more short term spot charters instead MIDF Research stayed with its ‘positive’
the Malaysian Industrial Development of long term charters due to the lack of assessment on the overall outlook of the
Finance (MIDF). certainty in projects and risk around oil and gas sector from last year, placing
MIDF’s research arm has reported most, committing to long term contracts in its confidence on supported global
if not all, global oil and gas producers the current environment. crude oil prices and sustained levels of
including national oil company Petro- Malaysian OSV operator Perdana Petro- oil output being met by local activity
nas will be slowing down on spending leum Bhd (Perdana Petroleum) had its levels.
to adjust to the current low oil price stock downgraded to ‘neutral’ by MIDF In spite of the doom and gloom in the
environment. in its 2014 Financial Report stating global oil and gas industry MIDF point-
“Petronas was quoted in the media caution on investment as production ed out that contracts were still being
indicating that it will be reducing sharing contract (PSC) operators em- awarded from Petronas.
capital expenditures by 10 per cent and barked on a cost rationalisation drive, Researchers noted at beginning of
operating expenditures by approximate- adding charter rates faced downward the year Petronas awarded two OSV
ly 25 per cent to 30 per cent,” a MIDF pressure and risk with vessel charter umbrella contracts to Alam Maritim
Research said. rates dropping. Resources Bhd and Icon Offshore Bhd,
Noting the effects are already being felt There is speculation from the Malay- adding the engineering and main-
in industry and equity markets with sian bank regarding potential knock on tenance works were also awarded to
oil and gas service providers asked to effects to other segments of the oil and Barakah Offshore Petroleum Bhd.
renegotiate existing contracts. gas industry that will impact the OSV “In addition to the award of contracts,
The MIDF research also indicated that industry. activity levels remain robust in Malay-
a number of offshore support vessel Using Perdana Petroleum as an exam- sian waters as can be seen from the huge
(OSV) operators were asked to readjust ple, MIDF said if hook-up and com- increase in national crude oil produc-
charter rates for new and existing con- missioning (HUC) contractors such tion,” it said.
tracts and some operators dealt with the as Dayang Enterprise Holdings Bhd Production data from last year shows a
cancellation of vessels as more oil and (Dayang) had to reschedule job orders 15 per cent increase; with the average
gas companies shift toward using fewer the effects could be felt at Perdana, as production rate around 580,000bpd in
vessels to cut costs. Dayang charters the vessels for its HUC the first nine months and boost in the
“The positive side of cost rationalisation activities from the petroleum company. fourth quarter with rates exceeding
within the industry is with regard to Brent crude has reported to be head- 670,000bpd.
operating efficiency,” MIDF’s research- ing in a slight upward direction after On average, oil and gas stocks under
ers said. experiencing a slump toward the end of MIDF Research’s coverage have appreci-
MIDF said OSV companies would now last year. Year to date figures show Brent ated by more than 3.4 per cent year-to-
need to review their own operating crude has gone up around 6 per cent date, in-line with the appreciation in
costs by reducing by staffing and ma- surpassing US$60 a barrel. Brent crude price.
terial costs to submit competitive bids, “Going forward, we are of the view that Stocks under the research arm’s ‘buy’
without compromising their own profit Brent crude price will trade range- recommendation however, have ap-
margin. bound between US$60-70 a barrel in preciated by over 15.7 per cent year to
“During times of subdued oil prices, op- 2015,” MIDF said. date (YTD), far outpacing the broader
erators and service providers can expect Based on average global oil demand market FBMKLCI gain of only 2.7 per
fewer job orders but at more competi- growth of 1.03 million barrels per day cent YTD. §
tive rates,” it said. (mbpd) for 2015 and 1.01mbpd for
A A24 OIL & GAS ustral SIA MARCH/APRIL 2015 www.oilandgasaustralasia.com
