KUCHING: DAYANG ENTERPRISE HOLDINGS BHD has won its first overseas contract for the maintenance of offshore facilities in the oil and gas (O&G) industry in Turkmenistan in central Asia.
Wholly owned Dayang Enterprise Sdn Bhd secured the three-year contract for the provision of facilities maintenance support for Petronas Carigali (Turkmenistan) Sdn Bhd, which will be undertaken with its local partner Gujurly Inzener via a joint-venture company.
The contract, effective Jan 1, 2019, has an option to be extended for one year.
Without stating the value of the contract, Miri-based Dayang said it is expected to contribute materially to the company’s profitability, which is on the verge of a strong turnaround after a lacklustre performance in the past two years due to the severe downturn in the O&G industry.
Dayang managing director Tengku Datuk Yusof Tengku Ahmad Shahruddin said the contract win was a significant milestone for the Dayang group to bring the company to greater heights by leveraging on its market leading expertise in topside major structural maintenance and hook-up commissioning on engineering, procurement, construction and commissioning (EPCC) services.
“We are fairly confident that this is only the beginning of our international expansion, which we envisage to be a strong earnings contributor to the group, going forward.
“We are proud that our strong execution track record throughout the years with various oil majors in Malaysia has lent credence to our international foray.
“We are hopeful that this Turkmenistan contract will serve as a springboard for us to further expand our geographical presence,” he added in a statement.
Tengku Yusof said Dayang has had a close working relationship with Petroliam Nasional Bhd since 1991 “which speaks volumes of our excellent delivery”.
Dayang, a leading O&G service provider for topside maintenance and services, fabrication operations, hook-up commissioning and charter of marine services, had an outstanding order book of RM3.1bil as of Sept 30, 2018.
The company said the contracts in hand would underpin clear earnings visibility at least over the next three years.
Dayang recorded remarkable results in the third quarter, with the group’s net profit soared to RM48.8mil on the back of higher revene at RM281.9mil.
The company said its business activities had picked up substantially for the quarter under review given the ramp-up in work orders for the maintenance, construction and modification (MCM) contracts and topside maintenance services works under the Pan’s hook-up and commissioning contract.
“We are delighted that the synergistic collaboration between Dayang and its subsidiary, Perdana Petroleum has worked out as what we have envisaged to be a leading integrated MCM player,” it added.
This year, Dayang secured a larger portion of the Pan MCM contracts estimated between RM1.5bil and RM2bil (the contracts are all based on unit rates and call-out contracts) from multiple production sharing contractors in Malaysia.
Meanwhile, Dayang subsidiary Perdana Petroleum Bhd, which owns a fleet of offshore support vessels (OSVs), reported a higher vessel utilisation rate of 84% in the third quarter ended Sept 30, 2018 (3Q18) from 70% in 2Q18.
Perdana attributed this to improved work orders from oil majors.
In 3Q18, Perdana posted a group net profit of RM6.5mil on a higher revenue of RM61mil against a loss of RM18.8mil and a revenue of RM49.8mil in 3Q17.
“We are cautiously optimistic of our vessel-chartering business, thanks to the high number of vessels that have been earmarked for Dayang’s offshore topside maintenance, and EPCC and hook-up contracts with various oil majors where activities have been going on in full swing.
“The recent contract awarded by Roc Oil (Sarawak) Sdn Bhd for the provision of one anchor-handling tug supply vessel is also testimony of our concerted efforts to achieve better vessel utilisation by exploring all available opportunities.
In 2017, Perdana operated a fleet of 16 OSVs, including eight anchor-handling tug vessels, six accommodation barges and two workboats.