SapKen poised to win RM1.5bil global jobs (Updated)

The Mumbai High South (MHS) project is speculated to require a new 12-slot well-head platform and two nine-slot platforms with clamped-on structures to be installed. The job also entails the laying of a total of 115.9km of subsea pipelines in 15 segments.

PETALING JAYA: SapuraKencana Petroleum Bhd (SapKen) is poised to land two international jobs in India and Mexico respectively totalling about RM1.5bil, according to a source close to the deals.

This development comes when the crude oil price has crossed US$60 per barrel two days ago, the first time in nearly five months.

The stock has been seeing some buying interest, topping the active list. It closed seven sen or 2.55% higher to RM2.81 against a lacklustre FTSE Bursa Malaysia KL Composite Index performance yesterday.

For the India job, SapKen may even edge out local-based Larsen & Toubro Ltd, as it has put in the lowest bid among the four contenders interested in a portion of the Oil & Natural Gas Corp’s Mumbai High South (MHS) phase three redevelopment project to the tune of US$200mil-US$300mil.

A source revealed that SapKen’s bid – between US$273mil and US$291mil – would have an added advantage, especially with the recent oil and gas (O&G) industry recovery.

SapKen’s bid for the Indian contract was done via its wholly owned offshore construction and subsea services arm, TL Offshore Sdn Bhd.

Larsen & Toubro, Abu Dhabi-based National ­Petroleum & Construction Co and US company McDermott have put in higher bids of US$390mil, US$471mil and US$406mil, respectively.

Besides likely frontrunner Larsen & Toubro, SapKen may face stiff competition if Singapore’s Swiber Holdings Ltd is successful in resubmitting its bid after it had failed to do so earlier due to technical issues, according to reports by an Indian news agency.

The MHS project is speculated to require a new 12-slot well-head platform and two nine-slot platforms with clamped-on structures to be installed.

The job also entails the laying of a total of 115.9km of subsea pipelines in 15 segments.

This is only part of the overall third-phase redevelopment of MHS, valued at US$982.4mil, predicted by some industry experts.

SapKen is not really foreign to the Indian market, as TL Offshore had previously clinched a subcontract for transportation and installation works for the British Gas Exploration & Production India Ltd Mukta B platform and pipeline project by Larsen & Toubro through L&T Sapura Offshore Ptd Ltd, which is an Indian joint-venture company between L&T and Nautical Power Pte Ltd.

The latter is a wholly owned unit of SapKen.

The source only has some sketchy details on the Mexico contract, but the deepwater and shallow structure contracts are expected to be more lucrative at around RM400mil.

Nevertheless, the Americas is SapKen’s new growth target area currently commanding about half of its order book in excess of RM28bil.

The country’s biggest O&G player by market value emerged as the world’s largest operator of tender rigs last year after buying part of Seadrill Ltd’s business for US$2.9bil. In February, it completed the purchase of Newfield Malaysia Holdings Inc for US$895.9mil.