The participation of Saudi Arabia’s state-owned oil company Aramco in the refinery and cracker project within the Pengerang Integrated Petroleum Complex (PIPC) has spillover benefits on companies that are already active in and around the 8,903-hectare development in Johor.
Acccording to analysts, these companies will include Dialog Group Bhd, Petronas Chemicals Group Bhd (PetChem) and Petronas Gas Bhd (PetGas).
“The companies benefit in various ways from potentially seeing higher demand for their products and services, and increased job fiows to enjoying lower risk and seeing less pressure on their capital expenditure [capex] requirement,” one analyst tells StarBizWeek.
“This is based on our expectations of increased business activities and investor interest, driven by the entry of Aramco into the massive project,” he adds. Over the week, Aramco signeda deal with Petroliam Nasional Bhd (Petronas) to invest US$7 billion for a 50 percent stake in Petronas’ Refinery and Petrochemical Integrated Development (Rapid) project, which is now under construction at the Pengerang Integrated Complex (PIC) within the PIPC development.
Notably Dialog, whose Pengerang Deepwater Terminal (PDT) is located just next to the PIC development, stands to gain the most.
For one thing, the Petronas-Aramco partnership could potentially result in higher demand for tank terminals and deepwater marine facilities in the PDT. The increased demand for these facilities will be to cater to the requirements of the Rapid refinery and other dovimstream petrochemical plants within the PIPC.
Further development of the PDT will also provide Dialog with more opportunities in areas such as engineering and procurement, construction and commissioning (EPCC), fabrication, plant main-
tenance and catalyst handling services.
According to a source, the potential investments into tank terminals in the PDT include an expansion of the existing independent tank terminals owned by the Pengerang Independent Terminal (SPV1), by an additional one million cubic metres.
The group also looks to benefit from the potential expansion of the dedicated tank terminal owned by Pengerang Terminals (Two) Sdn Bhd (SPV2), to be used by the Rapid refinery and petro-chemical plants, as well as the development of new tank terminals with deepwater jetty facilities capable of handling ultra and very large crude carriers.
In terms of EPCC, the source says, Dialog will benefit from the expansion works for the existing SPV 1 and SPV 2 as well as any new tank terminals to be built within the PDT.
“Dialog Group has successfully completed SPV 1 and the construction of SPV 2 is progressing within schedule.
“The group may also benefit from potential EPCC works for selected portions of the petrochemical plants in PIPC,” the source explains.
According to the source, Dialog looks to reap the benefits of recurring income from its SPVs due to the increased usage or expansions.
“With the ongoing operations of SPV 1 and current construction of SPV 2, Dialog is now working towards securing new potential partners for future phases, which will include the development of more petroleum and petrochemical storage terminals,” he explains.
Meanwhile, Dialog’s plant maintenance and catalyst handling services division will also gain from the Petronas-Aramco partnership, when the works in the Rapid project and the petro-chemical plants come on stream, as it could lead to increased demand for the group’s technical services.
As it stands, Dialog still has another 243-ha of land within the PDT as well as 81-ha of land that can be reclaimed in the PIPC. The group also has sufficient land to support the presence of downstream oil and gas companies in PIPC, where its Sungai Rengit Industrial Estate has 320 acres of industrial park which can accommodate petroleum and chemical storage facilities and warehouses, petrochemical manufacturing industries, bottling and drumming plants and open year storages.
According to an industry source, Aramco’s involvement in the Rapid project, which has attracted worldwide attention, will likely draw more downstream oil and gas companies to set up operations in the PIPC.
On that note, some fabrication yards nearby could benefit. Amlnvestment Bank.Research points out that Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE), which has a fabrication yard in Pasir Gudang, could be a likely candidate to gain through new job flows coming from the Pengerang development.
However, another analyst is not so optimistic about MMHE’s potential benefit due to the stiff competition. amid an oversupply of fabrication yards in the area. At present, there are about eight fabrication yards around the Pengerang area and an industry source says jobs will likely be given to only a handful of them. Separately, Amlnvestment points out there could be prospects for some other companies such as Barakah Offshore Petroleum Bhd and Muhibbah Engineering (M) Bhd to secure some outsourced contract works.
Jakarta Post, Page-15, Monday, March, 6, 2017
No comments:
Post a Comment