SapCrest

It is said to be close to securing a US$1 billion (RM3.55 billion) contract for installing pipelines and facilities (IPF) at the Gemusut oil well located offshore Sabah .

The contract, which is likely to be awarded soon, came about as a result of SapuraCrest’s negotiations with the production sharing contract parties — Shell, Petronas Carigali and ConocoPhilips.

In July 2008, SapuraCrest executive vice-chairman Datuk Shahril Shamsuddin had said that negotiations were ongoing but had not given any details.

During the July 2008, he had said: “The negotiations are ongoing. We are still at the clarification stage. It is a great engineering project, deep-water projects are very complicated, we need to be very careful, and go at it very slowly… so what’s happening now is that we are clarifying, making sure all risks are identified,” he had said.

Speculation of SapuraCrest bagging this job has been around since August 2008, but company officials have kept the information close to their chest.

It is also likely that SapuraCrest was the only serious contender for the job because of its Sapura 3000 — a deep-water pipe laying barge which is the jewel in the crown of SapuraCrest’s fleet of barges. In this region SapuraCrest is believed to be only company with such a barge.

This contract could result in SapuraCrest’s order book ballooning by about 50% to the region of RM9 billion and could be a big boost to its earnings.

SapuraCrest’s substantial shareholders are Sapura Holdings Sdn Bhd (39.9%) and Seadrill Ltd (24.3%), the vehicle of Norwegian tycoon John Fredriksen.

Financial Results …

For its six months ended July 2008, SapuraCrest posted a net profit of RM52.4 million on the back of RM1.6 billion in revenue. In contrast to the corresponding period a year ago, SapuraCrest’s net profits surged by about 141% while revenue soared by about 60%.

The better numbers were a result of increased activities in IPF, drilling and marine services divisions.