Kencana Petroleum Expects 2007 Revenue To Exceed RM800 Mln

Kencana Petroleum Bhd, scheduled for listing on the Main Board of Bursa Malaysia on Dec 15, 2006, expects group revenue to exceed RM800 million in 2007.

Executive chairman Datuk Mokhzani Mahathir said the group had registered a revenue of RM473 million for the year ended July 31, 2006, and expected this to be enhanced by securing local and overseas projects.

The group has about RM1.0 billion worth of projects in hand to keep it busy till late 2007 or early 2008, he told reporters after its prospectus launch by Second Finance Minister Tan Sri Nor Mohamed Yakcop here today.

Kencana Petroleum has announced a public issue of 200 million shares of RM0.10 each at RM0.41 per share, of which 44 million shares were for public subscription, 141 million for private placements and 15 million for eligible directors, employees and persons contributing to the success of the group.

The group, through wholly-owned Kencana HL Sdn Bhd and Kencana Bestwide Holdings Sdn Bhd, is an established provider of integrated engineering and fabrication of production facilities for the oil and gas industry.

It operates a major fabrication yard in the Lumut Industrial Park.

“For us, the future looks bright with the increase in oil and gas exploration activities and the need to turn it into production in a quick time,” Mokhzani said.

It is understood that the current high oil price will likely encourage further discoveries and investments n the upstream segment and will see to the demand for fabrication of new offshore platforms, he said.

Mokhzani said the group was currently servicing oil exploration companies in New Zealand, Australia, Malaysia-Thailand Joint Development Area and Sudan.

It has already begun to expand its product and service activities in Sudan and intends to further expand into Thailand, South Asia, Australasia, North Africa and the Middle East.

According to the prospectus, proceeds arising from the initial public offering (IPO) will amount to RM82 million, of which RM25 million will be utilised to repay borrowings, RM53 million as working capital and RM4 million for listing expenses.

In his speech, Nor Mohamed said the country needed to produce more world-class corporations that remained firmly anchored in Malaysian soil while building global scale through internationalisation.

“The leaders of our private sector companies must acquire the ambition and develop the vision and the passion to achieve the excellence of a global company and international competitiveness,” he said.

Most importantly, he added, the private sector must continue to expand the scale of their operations across boundaries and achieve higher levels of productivity and competency.

At the press conference, Nor Mohamed lauded Petronas for being recognised as a company with high standards and excellent management capability that delivered good financial results.

“We should be proud because we have a company that is able to attract the interest of many in the world,” he said.

He hoped that this would be emulated by others as about 50 companies listed on Bursa Malaysia were currently involved in the oil and gas sector. — BERNAMA