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Perdana Petroleum saw 'sluggish' market for OSVs in 2017

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Oil and gas (O&G) players reliant on the domestic Malaysian market such as Perdana Petroleum are still struggling compared to others who have the ability and have taken the initiative to search out new markets.

Performance has been declining in the naturally off peak fourth quarter in the domestic market as well. Perdana Petroleum said vessel utilization fell to 51% in the most recent quarter, due to a slower pace of work orders/contracts awarded by the oil majors, compared to 70% in the third quarter of 2017, leading to a decrease in revenue.

In a stock market announcement, Perdana Petroleum said: “Generally the market for OSVs for 2017 remained sluggish with fleet utilisation at 52% compared to 58% in 2016. Moreover, vessel charter rates also remained depressed at generally 25% lower compared to most charter rates in 2016.” The company mainly blamed these factors as revenue slid by almost a quarter to MYR147.8m ($37.8m) in 2017.

The offshore marine services provider was slightly more upbeat on the year ahead however. “Going into 2018 it is to be expected that the group’s vessel utilisation rate will improve as a substantial number of the group’s fleet will be earmarked for Dayang’s offshore maintenance and hook-up contracts with various oil majors where activities are already projected to be ramping high,” it said.

It added that the few remaining vessels which have not been set aside to meet its parent Dayang Group’s requirements, are participating in bids for offshore supply vessel (OSV) contracts domestically, regionally and also in international markets and tenders are still pending. 

“Also, with the price of crude oil hovering above $60 per barrel now, the board is more optimistic that sentiments should improve going forward,” Perdana Petroleum concluded.