KUCHING: KKB Engineering Bhd’s oil and gas (O&G) outfit OceanMight Sdn Bhd, which has secured two fabrication contracts for offshore structures in the last three months, is eyeing three more similar projects.
Group executive director Kho Pok Tong said OceanMight was awaiting the outcome of the three projects it had bid for, likely in the next six months.
“KKB group’s tender book currently stands at RM263mil, about half of which is related to the O&G industry. We are confident of securing between 30% and 40% of the contracts we have tendered for,” he told StarBiz after the company’s AGM last Thursday.
KKB has a 60.81% stake in OceanMight, which announced on May 15 that it had accepted and signed a letter of award from Sapura Fabrication Sdn Bhd for the provision of procurement and construction for wellhead deck, piles and conductors.
The award was part of Sapura’s engineering, procurement, construction, installation and commissioning (EPCIC) for the Pegaga Development project (Mubadala Petroleum) in Block SK320, offshore Sarawak.
In March, OceanMight secured another contract from Petronas Carigali Sdn Bhd for the provision of EPCIC of wellhead platforms for the D18 Phase 2 project and D28 Phase 1 project in Sarawakian waters.
“Works for both contracts commence in the current quarter for completion in the fourth quarter of 2019,” said Kho.
He said Petronas Carigali’s award of the EPCIC contract to OceanMight was significant, as this signified the latter as a full-fledged contractor in the O&G industry.
OceanMight, which is one of the seven fabricators licensed by Petroliam Nasional Bhd or Petronas, has completed and delivered four contracts since it commenced operations in 2014.
“We are a competitive bidder and one of the key players in the O&G industry.”
Kho said with the recovery of crude oil prices to the US$70-US$75 range, oil majors could be looking at more investments in exploration and production activities.
“We are hoping that oil majors could fast-track some of their projects and give out more work (to the O&G players).”
Kho said KKB’s well-equipped fabrication yard along Jalan Bako here had the capacity to carry out works for multiple contracts simultaneously.
He said the company had spent some RM6mil out of a capital expenditure of RM20mil for this year to expand the fabrication yard’s facilities and invest in new machinery and equipment to prepare for more jobs.
According to Kho, cash-rich KKB has a current order book of about RM1.05bil, which could last it until 2020. The ongoing single biggest project is the Pan Borneo Highway work package, which KKB is undertaking in partnership with WCT Holdings Bhd. The group’s cash pile now stands at nearly RM100mil.
“We are prepared to participate in the proposed Sarawak state water grid project. KKB group has the capacity and track record to bid for the construction work and supply construction materials, like steel water pipes, for the project,” he added.
According to Sarawak chief minister Datuk Patinggi Abang Johari Tun Openg recently, the state cabinet had decided to allocate between RM7bil and RM8bil to fund the water grid project.
The project will supply clean water from hydroelectric dam reservoirs to the many longhouses and settlements in rural Sarawak and irrigate agriculture projects. Phase 1 of the project, estimated to cost RM1bil, is targetted for completion within two years.