SapuraCrest, L&T to Operate Heavy-lift Vessel

SapuraCrest Petroleum Bhd, which is bidding for up to RM5 billion worth of jobs, has teamed up with India's Larsen&Toubro Ltd (L&T) to build and operate a RM483 million specialized vessel. Sapura group president and chief executive officer Datuk Shahril Shamsuddin said the vessel would allow them to tap into the growing global demand for oil and gas (O&G) engineering, procurement, installation, construction and support services.

"The companies are now better positioned to tender for installation contracts in India and the Middle East, two of the fastest growing oil and gas services markets in the region," he said after signing the joint-venture (JV) agreement with L&T in Seri Kembangan on April 3. Shahril said the US$138 million shallow water heavy lift-cum-pipe laying vessel (HLPV) was expected to be completed in early 2009.

He said SapuraCrest now had a fleet of 27 specialized vessels. He also expects to deliver in July its RM875 million Sapura 3000, a deep-sea-capable heavy lift derrick and pipe-laying vessel. On its bids for jobs worth RM5 billion, Shahril said more than half were local jobs, including a RM3 billion bid to install pipelines and facilities off Terengganu, Sabah and Sarawak.

He expects overseas jobs to account for 50% to 60% of its annual revenue in three years' time from only 15% to 20% now. L&T's president (operations) K Venkataramanan said: "This alliance would start with this particular asset and there would possibly be more down the road."

He said L&T was one of India's largest engineering and construction offshore companies with a market capitalization of US$10 billion (RM34.6 billion) and an annual turnover of some US$4.5 billion. Some oil and gas counters led by SapuraCrest closed higher after Aseambankers Malaysia Bhd said Petroliam Nasional Bhd would likely unveil the blueprint for the development of the Eastern Corridor States in the second quarter of 2007.

SapuraCrest's share price closed at a 26-month high of RM1.15, up 25.5 sen. Its warrants surged 29.5 sen to 70.5 sen. Wah Seong Corp Bhd added 26 sen to RM3.06, Dialog Group Bhd rose 23 sen to RM1.78 and Eastern Pacific Industrial Corporation Bhd gained 22 sen to RM1.94.

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