The RM676 million spending next year is for equipment upgrade and acquisition of new vessels, says the oil and gas services provider
OIL and gas services provider SapuraCrest Petroleum Bhd plans to spend some US$200 million (RM676 million) in capital expenditure next year to buy new vessels and upgrade equipment, its chief said.
"(The money is for) upgrade, new vessels, smaller vessels, ancillaries, equipment and fittings. Every job has its peculiarity and we'll go in and build up," executive vice-chairman Datuk Shahril Shamsuddin (pic) told Business Times in an interview in Seri Kembangan, Serdang, yesterday.
The company this year took delivery of its new heavy lift vessel, Sapura 3000, which it co-owns with the Acergy Group, a global leader in seabed-to-surface engineering and construction.
The vessel's first job will be the RM606 million Murphy Oil deepwater pipelaying project at the Kikeh oilfield. SapuraCrest will be building another heavy lift vessel with India's largest engineering and construction group Larsen & Toubro, Shahril said.
Such developments are expected to boost the firm's operating margin as the proportion of deepwater works grow.
Shahril said the company is bidding for another RM6 billion worth of contracts in the region, on top of the RM6 billion current order book.
"(The projects are in) India, Thailand, Malaysia, Brunei as well as Australia," he said.
At present, some 30 per cent of its revenue are from overseas but he believes foreign jobs will contribute half of its turnover in two years.
Shares of SapuraCrest have already gained 103 per cent this year, outperforming the benchmark Kuala Lumpur Composite Index's 25 per cent rise.
Shahril's family owns 40 per cent of the company, while Norwegian Seadrill Ltd, its long-time partner in the drilling business, holds another 14 per cent.
SapuraCrest made RM33.1 million in net profit for the financial year ended January 2007, down 69 per cent from the previous year as the company was hit by the loss in its installation of pipelines and facilities business.
The loss was a result of bad weather, which had delayed its work progress, and the rapid increase in global fuel price that was not priced into the earlier bids.
The vessel's first job will be the RM606 million Murphy Oil deepwater pipelaying project at the Kikeh oilfield. SapuraCrest will be building another heavy lift vessel with India's largest engineering and construction group Larsen & Toubro, Shahril said. 
