Gumusut Kakap Semi-Submersible Floating Production System, Sabah
KUALA LUMPUR: MISC Bhd
is buying back the 50% equity interest in Gumusut-Kakap Semi-Floating Production System (L) Ltd (GKL), the owner and lessor of Asia-Pacific’s first deepwater semi-submersible floating production system (semi-FPS), for US$445mil (RM1.9bil) in cash.
The energy shipping giant had disposed of the stake at cost to sister company Petronas Carigali’s unit E&P Venture Solutions Co Sdn Bhd in December 2012 for US$305.7mil (RM1.3bil).
MISC told Bursa Malaysia on Wednesday that it had sold the stake in GKL, which left it with the remaining 50%, to strengthen the group’s financial position, which has since improved significantly.
The monetisation of GKL enabled the MISC group to pare down its debt and improve its liquidity and cash position, it explained.
As at Dec 31, 2015, the group’s gearing level stood at 0.18 times. As such, it said, it would be able to undertake the proposed acquisition without impacting its gearing much.
Based on the proforma effects of the proposed acquisition, its gearing is expected to increase from 0.18 times to 0.30 times.
“The proposed acquisition represents a good opportunity for MISC to fully own an asset that is under a long-term lease with a strong client, which is a subsidiary of an international oil and gas company,” MISC said.
It noted that the Gumusut-Kakap semi-FPS was on a lease that would expire in 2039, 25 years from the start of commercial production in October 2014.
The Gumusut-Kakap deepwater project off Sabah’s coast is a joint-venture between Sabah Shell Petroleum Company (33%, operator), ConocoPhillips Sabah (33%), Petronas Carigali (20%) and Murphy Sabah Oil (14%).
According to a Shell website, the Gumusut-Kakap field comprises 19 subsea wells, with oil exported via a 200km long pipeline to an oil and gas terminal in Kimanis, Sabah.
MISC, which is a 62.67% owned subsidiary of Petroliam Nasional Bhd, said it would gain full control over GKL and would be able to fully consolidate its future earnings as GKL becomes its wholly-owned subsidiary.
“The increase in stable and recurring revenue contribution to MISC will further strengthen the financial position of the MISC group,” it added.
The proposed acquisition is expected to be completed in the second quarter of 2016.
Limited time offer:
Just RM5 per month.
