PETALING JAYA: Analysts are cautious on the earnings growth potential of Petronas Gas Bhd (PetGas) going forward as the company negotiates a fourth gas processing transmission agreement (GPTA) with parent company Petroliam Nasional Bhd (Petronas), and as the group faces a weaker outlook in the natural gas sector amid higher operating costs.
“We concur with consensus view that the new rates are likely to be less favourable, given the current demand decline for natural gas and continuous pressure on margins due to the higher gas feed costs,” MIDF Research told clients in a research note, referring to the GPTA, which is due for renewal in April 2010 and currently undergoing a preliminary review.