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UMW-OG targeting contracts worth $1.5bn

UMW-OG targeting contracts worth $1.5bn
UMW Oil and Gas (UMW-OG) is actively bidding for contracts with its management eyeing 22 contracts worth MYR5.4bn ($1.5bn), local media cited a CIMB Equities Research report as saying.

According to the research house, after speaking with UMW-OG president Rohaizad Darus it was reassured the oil and gas player would be looking for new contracts.

Rohaizad also revealed that following the expiry of contracts for Naga 2 and Naga 3 in late March and early April respectively, management will take advantage of the downtime to dry-dock the jack-ups, putting them out of action for up to three months.

“The dry-docking cost is around $15m for each jack-up. In addition to Naga 2, Naga 3 and Naga 6, two more jack-ups – Naga 5 and Naga 7 - are expected to have one- to three-month gaps in between contracts this year,” UMW-OG said.

CIMB Research said the operations of Naga 1 and Naga 4 were going smoothly. The contracts will expire in FY16 and FY18 respectively.

“Management is pressing on with its aggressive approach to ensure all its assets are contracted, bidding for 22 contracts worth MYR5.4bn as at Feb 2015. Of the 22 contracts, eight are domestic and the rest are international.

“The split between long-term and short-term contracts is 36:64. The company’s order book stood at MYR1.8bn as at Dec 31, 2014.

“The plan to venture into the Middle East by year-end is intact,” it said.

CIMB Research said Naga 8 might be deployed to facilitate the new venture. The jack-up, which is expected to be delivered in September 2015, was 76.44% completed as at February 2015.

TAGS: Offshore