PETALING JAYA: MISC Bhd
’s entry into the South American region will provide a new revenue stream for its floating production, storage and offloading (FPSO) unit but production is unlikely to take place immediately.
MISC via its petroleum arm, AET, has added two liquefied natural gas (LNG) dual-fuelled FPSOs into its fleet.
The fleet will be deployed to offshore Brazil, signalling MISC’s entry into the region.
However, MIDF Research is not factoring in the revenue for MISC at this juncture, as production will not commence soon given the uncertainties in crude oil prices as well as the regional conflict in the Middle East continuing to pose a risk to offshore vessels.
“As such, we maintain our ‘neutral’ call on MISC, with a target price of RM7.37. Our target price is based on the price earnings ratio of 13.8 times to the revised earnings per share of financial year 2024 of 53 sen,” it said.
The FPSOs Marechal Duque de Caxias and Eagle Veracruz were recently named and introduced to MISC’s fleet.
MISC said 15% of AET’s fleet is powered by LNG dual-fuel technology, and the numbers are expected to grow.
“By using dual-fuel engines, we are expecting LNG demand for this industry to grow in the near future, hence solidifying our forecast that LNG will be less susceptible in the commitment for energy transition, as per the National Energy Transition Roadmap or NETR,” the research house said.
