Malaysia's Coastal Contracts Bhd (Coastal or Company, and together with its subsidiaries Coastal Group or Group) disclosed Monday that its wholly owned subsidiary, Coastal Offshore (Labuan) Pte Ltd. has secured contracts for the sales of two units Offshore Support Vessels (OSV) for an aggregate value of approximately $54.2 million (MYR 197 million).
Both of these vessels were sold to our new customers in Mexico. As of to date, the Group’s order book is approximately $773.3 million (MYR 2.81 billion). Of this, the vessels sales order book constituted $401.8 million (MYR 1.46 billion). The balance order book comprised $371.5 million (MYR 1.35 billion) for the Group’s first Jackup Gas Compression Service Unit (JUGCSU) charter contract for Petroleos Mexicanos (Pemex).
All of these vessels are expected to be delivered in 2015 and 2017. Consequently, the revenue stream from these vessels is expected to contribute positively to the top and bottom line performance of the Group for the financial years ending Dec. 31 and Dec. 31, 2017.
Ng Chin Heng, the executive chairman of Coastal, commented:
“I am pleased to announce that Coastal Group has secured its first batch of vessel sales orders for FY2015. With these latest sales, our vessel sales order book has further increased to a high of $401.8 million (MYR 1.46 billion), balanced with our long term charter contract for Pemex project.
We are pleased to have the opportunity to enter business relationships with our new customers in Mexico. We continue to widen our global presence as a reliable shipbuilder and O&G player in Mexico. Mexico is an active market with a variety of projects on going and in the pipeline. There are some concerns due to sliding oil prices, but most of the projects are currently on schedule.
By virtue of our successful crisis management experience from the past, I believe we can weather the downturn as well as capture new market opportunities during this challenging time.”
Ng further added:
“Despite current signs of gloom, Coastal Group envisages the medium to long term fundamentals of O&G industry to remain positive given the hardly substitutable nature of petroleum. O&G business is not a short term game, and the window of opportunity may well be very short before the next cycle begins.”
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