Bumi Armada unit wins pipeline contract
Bumi Armada Bhd's subsidiary Armada Marine Contractors Caspian Pte Ltd has been awarded a charter contract to lay 15km of pipelines off Turkmenistan, The Star reports.
Armada Marine won the contract from Momentum Engineering (LLC) of Turkmenistan to lay various size pipelines in the Caspian Sea.
The contract is for a period of 30 days beginning end of May with an extension option of 15 days from the initial period.
Chief executive Hassan Basma said in a press statement that the Caspian region had ample oil and gas reserves and exports from the area could more than double over the next 25 years.
“Our Armada Installer with its new 825-tonne crane is one of only two derrick barges in the landlocked Caspian Sea and we are optimistic of growth in the region,” he added.
He said that with the contract and the recent OOO Lukoil-Nizhnevolzhskneft contract, the offshore oil field services company's order book would exceed RM7bil.
An analyst covering the counter said the contract should not exceed RM50mil and would optimise the vessel utilisation.
“Actually, there is only minimal impact on the company but it means that (Bumi Armada's) vessel will be fully utilised for the rest of the year since the company has another two contracts in the same region,” he told StarBiz.
Bumi Armada has two other contracts for pipelay in the Caspian Sea from Russian oil major Lukoil and Petroliam Nasional Bhd.
The Lukoil contract, awarded in April, was worth US$200mil (RM640mil) for the installation of 90km of pipelines for the Filanovsky field in the Russian sector of the Caspian Sea.
“The company won the contract because it owns one of the two pipelay vessels in the Caspian Sea now,” he said, adding that vessels were not easily brought into the landlocked sea as it was only accessible through canals.
When Bumi Armada got the Lukoil contract, CIMB Research wrote that its earnings visibility was good given the long-term nature of contracts, especially for the floating production, storage and off-loading jobs division. Bumi Armada currently has clients in Asia, Africa and Latin America.
